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INSIDE THE REPORT
To view the report online log on to
www.nitinspinners.com
Independent Auditors’ Report 61
Balance Sheet 70
Statement of Profit & Loss 71
Cash Flow Statement 72
Statement of Changes in Equity 73
Notes to the Financial Statements 74
FINANCIAL STATEMENTS 61-112
Board’s Report 20
Management Discussion and Analysis 44
Corporate Governance Report 49
STATUTORY REPORTS 20-60
CORPORATE OVERVIEW 02-19The Fabric of Excellence 02
Weaving a Global footprint 04
Spinning an Innovative Product Portfolio 06
Confidence tied to Key Numbers 08
Chairman’s Speak 10
Financial Performance 12
Unique creations at our Manufacturing facilities 14
Awards and Certifications 15
A culture of responsibility 16
Management Team 17
Board of Directors 18
Corporate Information 19
Success is often a pretty straightforward equation – you consistently bring in new ideas, you act on them with commitment and you persist until the results to come in. This is what has helped us on our journey this year as well.Keeping innovation at the forefront,
we strategized the areas that
needed our focus; once we knew
where our priorities must lie, we
made requisite investments in
capacities, got the ball rolling on
our various expansion initiatives
and thereby we paved the way for
our growth.
Coupled with complimentary
growth in our industry, which
further boosted demand,
the year has been one of
satisfactory performances, and
we look ahead to furthering our
expansions and entering the
next phase of our growth by the
next fiscal.
THE FABRIC OF EXCELLENCE
Nitin Spinners has emerged as a leading manufacturer of 100% cotton yarn and knitted fabrics in India with over 25 years of experience. We have capitalized on growing opportunities strengthening our market presence in over 50 countries across the globe.
Commencing our journey with a small open-end spinning facility in 1992, we progressed into ring-spinning and
subsequently forward integrated into knitted fabrics. The combination of manufacturing expertise and sustained
investments are today the corner-stone of our success story.
Our Vision
• Become Integrated Textiles
manufacturer by forward and
vertical integration
• Remain at the forefront in
high-quality textile products
manufacturing
• Create value for shareholders and
allied industries
• Increase foreign exchange earnings
by being the preferred international
supplier
• Stay effective and proactive in
developing new markets and
products
• Endeavour for the ultimate
satisfaction of our allied partners
with:
• The Right Technology
• The Right Raw Material
• The Right People, and above all
• The Right Attitude
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
02
Our Mission
• To be the most reliable supplier
across textile value chain
• Provide superior quality
products at competitive prices
and establish a brand value in the
international arena
• Exceed industry standards
with exceptional customer and
technical service
• Maintain our competitive
strategic position through
leading edge technology
• Provide a safe, fulfilling and
rewarding work environment for
employees
• Promote partnerships with
government agencies and
institutions of international
recognition
• Provide training to our employees
for their future development
H515Crores
H1,242Crores
3,130
Market Capitalisation
as on 31st March 2019
Revenue in 2018-19
Total Employee strength
as on 31st March 2019
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
03
WEAVING A GLOBAL FOOTPRINTThrough our diversified range of products, we have not only expanded our footprint in India but also strengthened our presence in international boundaries. With our global customer base, we have deepened our regional focus and gained insights into how we can best meet our consumer needs across the geographies where we operate.
1. BELARUS
2. BELGIUM
3. AUSTRIA
4. CROATIA
5. CZECH
6. DENMARK
7. ESTONIA
8. FRANCE
9. GERMANY
10. ITALY
11. LITHUNIA
12. MACEDONIA
13. COLOMBIA
14. POLAND
15. PORTUGAL
16. RUSSIA17. HONDURAS
18. SPAIN
19. SWEDEN
20. TURKEY
21. UNITED KINGDOM
22. CANADA
23. MEXICO
24. USA
25. BRAZIL
26. CHILE
27. DOMINICAN REPUBLIC
28. ECUADOR
29. PERU
30. EGYPT
31. MADAGASCAR
32. MAURITIUS
33. SOUTH AFRICA
34. TUNISIA
35. BANGLADESH
36. EL SALVADOR
37. CHINA
38. HONG KONG
39. INDONESIA
40. SINGAPORE
41. ISRAEL
42. JAPAN
43. KOREA
22
24
23 27
28
29 25
26
33
31
30
3441
49
40
4537
46
44
201518
213
10
12
17
13
1411
19
45
89
2 16
7
32
48
50
33
36 4648
47
42
43
4439
16
35
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
04
44. MALAYSIA
45. PAKISTAN
46. SRI LANKA
47. TAIWAN R.
48. THAILAND
49. U.A.E.
50. VIETNAM
50Countries of export
Key numbers – 2018-19
Revenue from exports
H844Crores
STATUTORY REPORTS 20 FINANCIAL
STATEMENTS 61CORPORATE OVERVIEW 02
05
SPINNING AN INNOVATIVE PRODUCT PORTFOLIO At Nitin Spinners, it is our top priority to deliver quality products to our customers, while maintaining our commitment to quality.
We provide…
Yarns
• Ring Spun Combed Yarns
from Ne 10/1 to Ne 80/1
• Multi-fold Ring Spun Yarns
• Fancy Slub Yarns
• Core Spun Yarns
• ‘S’ & ‘Z’ Twist Yarns
• Dye-able cheese/cones
– Soft package
• 100% Organic Cotton Yarns
and Blends
• BCI/TBC Certified Yarns
• Supima and Giza Certified Yarns
• Zero Twist Yarn for Towel
• Eli Twist Yarns (Siro Yarns)
• Open End Yarns from Ne 6/1
to Ne 24/1
• Multi-fold Open End Yarns
79%Revenue share of Cotton
Yarn segment in 2018-19
14%Revenue share of Knitted
Fabrics segment in 2018-19
Revenue from yarn segment
H 984Crores
Revenue from knitted fabrics segment
H 178Crores
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
06
And ..
To cater to the several downstream industries:
Knitted Fabrics
• Single Jersey
• Pique structures
• Interlock structures
• Rib structures
• Lycra Blended Fabrics
• Apparel & Garments
• Inner wear
• Terry Towels
• Woven Fabrics
• Home Furnishings
• Carpets
• Denim
• Industrial Fabrics
• Medical Textiles
• Mattresses
• Socks
• Tea Bags
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
07
CONFIDENCE TIED TO KEY NUMBERS We hold a differentiated position in the textile market offering a wide range of products under yarn and knitted fabrics segment while also supplying a complete range of products to fulfil the wide end-user industry needs.
1.4:1Debt-equity ratio
6.26Interest coverage in 2018-19
50Years of experience
of top management
700KmsDistance to nearest port
Amount invested in capacity
expansion in last three years
H 745Crores 3,130Employees as on March 31, 2019
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
08
CHAIRMAN’S SPEAK
Dear Shareholders,
India stands at a threshold of resurgent
economic growth. With the recently
elected government with a strong
mandate and ambitious target of
reaching $5 trillion economy by 2025,
the country stands as a stronger
emerging economic nation. We began
the year with an aim to widen our
product market presence and enhance
our product portfolio that would
transcend into improved financial
metrics. And I am happy to report we
did achieve our targets despite several
challenges. Our theme for the annual
report aptly summaries our attitude
and rationale during the current fiscal.
Our pursuit towards excellence, our
resilience in executing our strategies
and commitment to deliver growth
were reasons that helped 2018-19 to be
a productive year for Nitin Spinners, as
we demonstrated significant progress
to create a sustainable organization for
the long-term future.
Economic review
During the year, the Indian economy
registered a GDP of 6.8% on the back
of favourable demographic dividend
and a number of structural reforms
that took place during the year. In
addition, strengthening investments
and robust private consumption
further helped clock a growth rate
to outperform the macro-economic
I believe that the opportunities for Nitin Spinners are endless as we continue to execute on our strategic priorities with an emphasis on driving long-term value creation.
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
10
challenges. Moderation in global
demand due to tightening of
financial conditions and uncertainty
arising out of global trade tensions
continued to pose challenges.
Industry perspective
Amid these uncertainties, the global
as well as Indian textile and apparel
industry grew at a robust pace. While
China became the largest exporter
of textile and apparels with a market
share of 36%, India emerged as
second largest exporter with market
share of 5%. The domestic textile
and apparel industry is growing at
a robust rate due to notable rise
in demand on account of growth
in per- capita income, favourable
demographics and a shift to branded
product preference. This has created
demand growth in the apparel
segment, thereby driving demand for
apparel fabrics.
Operational excellence
FY 2018-19 was a year of business
momentum and profitable growth for
us. Our diverse product portfolio and
wide global client base provided us
a foundation to build for the future.
With major expansion initiatives in
line, we posted a revenue growth
of 8.5% from H 1145.25 Crores to
H 1242.51 Crores in FY 2018-19. Of
this, the revenue under cotton yarn
segment constituting 79.21% of total
revenue increased by 11.78% from
H 880.50 Crores in 2017-18 to
H 984.19 Crores in 2018-19 whereas the
revenue under Knitted Fabric segment
stabilized at H 178.06 Crores In addition
to this, our EBITDA increased from
H 157.17 Crores in 2017-18 to
H 180.84 Crores n 2018-19 during
the year and PAT grew from
H 52.39 Crores in 2017-18 to
H 64.11 Crores in 2018-19.
Expansion plans
During the year, we worked towards
installation of Integrated Textile Unit
at Bhanwaria Kalan, Tehsil Begun in
the District of Chittorgarh, Rajasthan
at an estimated project cost of
H 675 Crores. The work is in progress
and trial production in spinning and
weaving divisions has commenced
In the expansion project we are
manufacturing value-added products
by entering into finished fabric
segment to supply quality fabrics to
renowned apparel manufacturers. In
the yarn segment, we are expanding
our product range by introducing
Ring spun Carded yarns and PC
blended yarns.
Technological capabilities
Emerging technologies across
industries are playing a critical role
in remaining relevant to business
sustainability. As a result, we continued
to invest in our technologies to drive
our operational excellence. We have
always deployed latest machines
across our manufacturing operations
that are automated to reduce the use
of unskilled manpower, improve the
quality of our products and optimise
power consumption.
Our people
I strongly believe that our success
over the years would not have
been possible without the efforts
of our people. Thus, we, at Nitin,
are committed to developing our
employees, retain exceptional talent
and build an engaging work culture
to develop future leaders. During
the year, we worked with a strength
of more than 3000 employees
empowering them towards career
development and also provide on-
the-job training to our workers and
staff.
Road ahead
Going forward, we have a number of
initiatives underway that would help
us increase our market share around
the world while driving profitable
growth for our shareholders. We
expect our ongoing expansion
project to be completed by this
fiscal. Before entering the next phase
of expansion, we plan to work on
fully utilizing our added capacities
of yarn and knitted fabrics. We also
expect to achieve a revenue level of
over H 2000 Crores by FY 2020-21.
I believe that the opportunities for
Nitin Spinners are endless as we
continue to execute on our strategic
priorities with an emphasis on
driving long-term value creation.
Our commitment to our consumers,
associates and communities drives us
every day, and the passion we share
unites us across this organization.
Hereby, I would like to thank all our
stakeholders, for their confidence
in our company and our vision.
With your support, we will continue
to deliver sustainable, long-term
value for you, while also making a
meaningful difference.
Regards,
R.L. Nolkha
Chairman
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
11
FINANCIAL PERFORMANCE
Revenue
(H Cr)
PAT
(H Cr)
EBITDA
(H Cr)
PAT Margin (%)
EBITDA Margin
(%)
Current Ratio
616
767
933
1,145
1,242
FY15
FY16
FY17
FY18
FY19
16.9
17.9
14.4
13.7
14.5
FY15
FY16
FY17
FY18
FY19
6.6
5.8
6.1
4.6
5.2
FY15
FY16
FY17
FY18
FY19
104
138
134
157
181
FY15
FY16
FY17
FY18
FY19
41
44
57
52
64
FY15
FY16
FY17
FY18
FY19
1.50
1.47
1.27
1.97
1.43
FY15
FY16
FY17
FY18
FY19
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
12
ROACE
(%)
Revenue Mix
(%)
Debt Equity Ratio
1.95
1.43
1.78
0.87
1.40
FY15
FY16
FY17
FY18
FY19
15.7
16.5
12.5
11.5
11.2
FY15
FY16
FY17
FY18
FY19
Domestic32
Exports68
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
13
UNIQUE CREATIONS AT OUR MANUFACTURING FACILITIES Product design and innovation, including suitability for end use, finish and quality, are important elements across our business. This is achieved at Nitin with our manufacturing facilities equipped with contemporary technologies giving us a competitive edge over other industry players.
Key Highlights
98%Capacity utilization of Yarn
manufacturing facility during 2018-19
9,000mtpaCapacity of Fabric manufacturing
facility
50,000mtpaCapacity of Yarn manufacturing facility
223,056Installed capacities of Spindles during 2018-19
63Knitted Fabric Machines
7,000mtpaAnnual production of Fabric during 2018-19
49,200mtpaActual production of Yarn
2,936Rotors during 2018-19
80%Capacity utilization of Fabric
manufacturing facility during 2018-19
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
14
AWARDS AND CERTIFICATIONS
Awards:
Certifications:
Cotton Certifications:
Texprocil Silver Plaque
for second highest exports of grey
fabrics in 2017-18
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
15
A CULTURE OF RESPONSIBILITY
Our commitment to leading CSR practices is deeply embedded within our overall corporate strategy and we recognize it as a key driver of our business success. We believe that our goals will be achieved by Caring for our People, Conserving the Environment and Creating Stronger Communities through our labour practices, sustainability programs and social initiatives.
During the year under review, we placed focus on empowerment of women and conservation of water. In addition, we
also undertook various other initiatives for improvement of the standard of living in the community we operate. Our
sustainable initiatives include:
Construction of women Hostel
Contribution for Rajasthan
Textile Heritage Event
Contribution for Cotton
Development activities
Construction of check dam for
conservation of water
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
16
MANAGEMENT TEAM
Shri R.L. Nolkha Chairman
Shri Nitin Nolakha Executive Director
Shri Dinesh Nolkha Managing Director
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
17
BOARD OF DIRECTORS
Shri R.L. Nolkha Chairman
Smt. Aditi Mehta Independent Director
Shri Y. R. Shah Independent Director
Shri Nitin Nolakha Executive Director
Shri Dinesh Nolkha Managing Director
Dr. R. Chattopadhyay Independent Director
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
18
CORPORATE INFORMATION
Board of Directors
Shri R. L. Nolkha
Chairman
Shri Y. R. Shah
Independent Director
Shri Dinesh Nolkha
Managing Director
Smt. Aditi Mehta
Independent Director
Shri Nitin Nolakha
Executive Director
Dr. R. Chattopadhyay
Independent Director
Key Executives
Shri Sandeep Garg
President (Operations)
Shri P. Maheshwari
Chief Financial Officer
Shri S.S. Basu
Sr.Vice President (Processing)
Shri Umesh Toshniwal
Vice President (Mktg.)
Shri K.L. Pareek
Vice President (HR)
Shri Anil Jain
Vice President (Commercial)
Shri D.K. Dasgupta
Vice President (Weaving)
Company Secretary & GM (Legal)
Shri Sudhir Garg
Bankers
Punjab National Bank
Oriental Bank of Commerce
State Bank of India
Bank of Baroda
Union Bank of India
Auditors
M/s. Kalani & co.
Chartered Accountants
Secretarial Auditors
M/s V.M. Associates
Company Secretaries
Cost Auditors
Vivek Ladha & Associates
Cost Accountants
Registered Office
16-17 Km. Stone, Chittor Road,
Hamirgarh, Bhilwara - 311 025
(Rajasthan)
CIN - L17111RJ1992PL C006987
Telephone - 01482 - 286110 - 113
Fax - 01482-286117
E-Mail - [email protected]
Website - www.nitinspinners.com
Works
1. 16-17 km Stone,
Chittor Road ,Hamirgarh
Distt Bhilwara- 311025 (Rajasthan)
2. CHITTOR - KOTA N.H. 27
Village Bhanwaria Kalan
Tehsil- begun
Distt Chittorgarh- 312023
(Rajasthan)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
19
BOARD’S REPORTTo
The Members
Your Directors have pleasure to present the 27th Annual Report on the business and operations of your Company along
with the Audited Financial Statements for the year ended 31st March, 2019
FINANCIAL RESULTS
The Financial Results of the Company’s operations for the year under review and those of the previous year are as
follows: -
(H in Crores)
Particulars Current Year
2018-19
Previous Year
2017-18
Revenue From Operations 1242.51 1145.25Gross Profit Before Finance Cost, Depreciation & Exceptional item 180.84 157.18
Finance Cost 28.90 29.55
Profit before Depreciation, Exceptional items and Tax 151.94 127.63
Depreciation 54.64 56.19
Exceptional items - -
Profit before Taxation 97.30 71.44Provision for Taxation- Current (Net of MAT Credit) 36.41 15.98
-Earlier Year (1.50) (5.14)
-Deferred Tax (1.72) 8.21
Profit after Tax 64.11 52.39Other Comprehensive Income net of Income Tax 1.67 (1.28)Total Comprehensive Income for the period 65.78 51.11
OPERATIONAL REVIEW
REVENUE FROM OPERATIONS
The revenue from operations during the year under
review is at H 1242.51 Crores against H 1145.25 Crores in
the previous year, registering an increase of 8.49%. The
revenue of Cotton Yarn increased by 11.78% from H 880.50
Crores to H 984.19 Crores. The revenue from Cotton Yarn
constitutes 79.21% of the total Sales against 76.88% during
the previous year, whereas revenue of Knitted Fabric
remains stable at H 178.06 Crores. Knitted Fabric revenue
constitutes 14.33% of the total revenue from operations.
In quantity terms Company produced 49216.22 M. Tons of
Cotton Yarn and 6966.46 M.Tons of Knitted Fabric during
the year under review.
EXPORTS
Exports of the Company increased substantially by 14.51%
from H 737.12 Crores in the previous year to H 844.06
Crores in the current year. Exports constitute 67.93% of
the total revenue.
PROFITABILITY
The operating profit (EBIDTA) of the Company has increased
from H 157.18 Crores in the previous year to H 180.84 Crores
in the current year registering an increase of 15.05%. In
percentage to revenue from operations, the operating profit
(EBITDA) increased from 13.72% in previous year to 14.55%
in current year.
The Cash Profit (PBDT) for the current year was H 151.94
Crores against H 127.63 Crores in the previous year
registering significant increase of 19.05%. Finally, there was
remarkable increase of 28.70% in the total comprehensive
income after tax of the Company as it has increased to
H 65.78 Crores for the current year as against H 51.11 crores
during last year. The Company has reported Earnings per
Share of H 11.43 during the current year against H 10.56 in
the previous year.
TRANSFER TO GENERAL RESERVE
Your Directors has proposed to appropriate a sum of H 10.00
Crores to General Reserves out of total comprehensive
income of H 65.78 Crores.
DIVIDEND
Your Directors are pleased to recommend Dividend of
12.50% i.e. H 1.25 per Equity Share on the fully paid-up
Equity Shares of H 10/- each for the financial year 2018-19
subject to approval of shareholders at the ensuing Annual
General Meeting. An amount of H 144.45 Lacs shall be
paid as dividend distribution tax on the above Dividend
recommended. No interim dividend declared during the
reporting period.
20
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
BOARD’S REPORT (CONTD..)INSTALLATION OF INTEGRATED TEXTILE UNIT
The Company has undertaken to install Integrated Textile
Unit at Bhanwaria Kalan, Tehsil Begun in the District of
Chittorgarh, Rajasthan at an estimated project cost of
H 675 Crores. The same is progressing as per schedule and
Trial production in Spinning & Weaving Units is in process.
RAISING OF FUNDS THROUGH PREFERENTIAL ISSUE
During the year under consideration the Company has
raised funds through issue of 6,68,290 Equity Shares of
H 10/- each at a premium of H 110.50 each aggregating to
H 8.05 Crores to one of the Promoters of the Company on
preferential basis inter-alia for repayment of debts, general
corporate purposes etc. The paid up share capital of the
company has increased from H 5555.17 Lacs to H 5622.00
Lacs after this allotment. This has strengthened long term
resources of the company and will help the company in its
growth plans. The funds have been utilized for the purpose
for which same were raised.
CORPORATE SOCIAL RESPONSIBILTY (CSR)
Your Company is committed to make a positive contribution
to communities where it operates. Pursuant to Section 135
of the Companies Act, 2013, the Company constituted CSR
committee and formulated CSR Policy as guiding principle
for undertaking CSR activities. The Company’s vision on
CSR is that the Company being a responsible Corporate
Citizen would continue to make a serious endeavor for
improvment in quality of life and betterment of society
through its CSR related initiatives.
During the current year, the Company has incurred
expenditure of H 142.46 Lacs on CSR activities against
obligation of H 137.93 Lacs. Accordingly, during the year
there is no shortfall on CSR expenditure. The disclosures
of CSR activities pursuant to Section 134(3) of the
Companies Act, 2013 read with Rule 9 of Companies
(Corporate Social Responsibility) Rules, 2014 is annexed
hereto and form part of this report as Annexure – I.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Shri Ratan Lal Nolkha, Director of the Company who
retired and being eligible, was re-appointed at the
Annual General Meeting of the Company held on
22nd September, 2018.
Shri Nitin Nolakha, Director of the Company retires by
rotation at the ensuing Annual General Meeting and being
eligible, offer himself for re-appointment. The Board
recommends his appointment for consideration of members
of the Company at the ensuing Annual General Meeting.
The tenure of appointment of Sh. Y. R Shah, Smt. Aditi
Mehta and Sh. R. Chattopadhyay is expiring on 10th
September, 2019. Pursuant to recommendation of the
Nomination and Remuneration Committee, the Board of
Directors at its Meeting held on 10th August, 2019 has
approved their re-appointment for second term subject to
the approval of shareholders through Special Resolution.
The tenure of appointment of Sh. Dinesh Nolkha, Managing
Director is expiring on 30th September, 2019. Pursuant to
recommendation of the Nomination and Remuneration
Committee, the Board of Directors at its Meeting held on
10th August, 2019 has approved his re-appointment for
another term of 3 years from 01.10.2019 to 30.09.2022,
subject to the approval of shareholders through
Special Resolution.
Necessary resolutions for re-appointment of Directors
seeking re-appointment together with details for re-
appointment have been included in the Notice convening
ensuing Annual General Meeting.
No other changes have been taken place in composition
of Board of Directors and Key Managerial Personnel of the
Company during the year under review.
All Independent Directors of the Company have
confirmed that they meet criteria of independence as per
requirement of Section 149(6) of the Companies Act, 2013
and regulation 16(b) of the SEBI (Listing Obligations &
Disclosure Requirements) Regulations, 2015.
All the Directors have confirmed compliance of Code of
Conduct for Directors and Senior Management Personnel.
A declaration by Managing Director confirming the
receipt of this declaration from Directors is enclosed to
this Report.
AUDITORS
STATUTORY AUDITORS
M/s Kalani & Co., Chartered Accountants (FRN 000722C)
were appointed Statutory Auditors at the 25th Annual
General Meeting held on 4th September, 2017 for five years
till the conclusion of 30th Annual General Meeting to be
held in the calendar year 2022. Accordingly, they have
conducted Statutory Audit for the F.Y. 2018-19 and shall
continue to be Statutory Auditors for the F.Y. 2019-20.
The audit report on the financial statements for the financial
year ended on 31st March, 2019, issued by M/s Kalani & Co.,
Chartered Accountants, do not contain any qualifications,
reservations or adverse remarks. The information referred
in Auditor’s Report are self explanatory and hence do
not require any further clarification. The Audit report is
enclosed with the financial statements in the annual report.
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
21
BOARD’S REPORT (CONTD..)SECRETARIAL AUDITORS
The Board of Directors has appointed M/s. V. M &
Associates, Company Secretaries (Firm Registration No.
P1984RJ039200), to conduct Secretarial Audit for the
F.Y. 2018-19 under the provisions of Section 204 of the
Companies Act, 2013. Accordingly, they have conducted
Secretarial Audit for the F.Y. 2018-19 and Secretarial Audit
Report in Form MR-3 is enclosed herewith. The report does
not contain any qualification, reservation or adverse remark.
The Board of Directors has re-appointed M/s V. M. &
Associates, Company Secretaries (Firm Registration No.
P1984RJ039200), being eligible, to conduct Secretarial
Audit for the Financial Year 2019-20 under the provisions
of Section 204 of the Companies Act, 2013.
COST AUDITOR
The Board of Directors has appointed M/s. Vivek Laddha
& Associates, Cost Accountants (FRN 103465) to conduct
Cost Audit of the Company for the Financial Year 2018-19.
Pursuant to Section 148 of the Companies Act, 2013,
your Directors have re-appointed M/s. Vivek Laddha
& Associates, Cost Accountants (FRN 103465), being
eligible, to conduct Cost Audit of the Company for the
Financial Year 2019-2020.
CORPORATE GOVERNANCE
The Company is committed to maintain the high standards
of Corporate Governance. Your Directors adhere to the
requirements set out in Companies Act, 2013 and the
SEBI (Listing Obligations & Disclosure Requirements)
Regulations, 2015 and have implemented all the prescribed
requirements. In pursuant to regulation 34(3) of the
SEBI (Listing Obligations & Disclosure Requirements)
Regulations, 2015, the Reports on Corporate Governance
and Management Discussions & Analysis have been
incorporated in the Annual Report and forms an integral
part of the Board Report.
AWARDS, RECOGNITION & CERTIFICATIONS
Your Company has been conferred with the following
awards and recognition during the year under review :-
1. Texprocil’s Silver Plaque for second highest exports of
Fabric under the category 1 for the Financial Year 2017-18.
2. UCCI Excellence Award 2019 by Udaipur Chamber
of Commerce & Industry under Large Enterprise
Category (Manufacturing).
3. Certifications :
Your Company continued to hold following
certifications from British Standards Institution (BSI):-
(a) Quality Management System - ISO 9001:2015
(b) Environmental Management System - ISO
14001:2015
(c) Energy Management System - ISO 50001:2011
(d) Occupational Health & Safety Management
System - OHSAS 18001:2007
(e) Social Accountability System - SA 8000:2014
HUMAN RESOURCE DEVELOPMENT
Industrial relations continued to be cordial during the
period under review. Your Company firmly believes that
a dedicated work force constitutes the primary source of
sustainable competitive advantage. Accordingly, human
resource development received focused attention. The
Company has in house skill training centre and imparts
on the job training to its manpower on continuous basis.
Your Directors wish to place on record their appreciation
for the dedicated services rendered by the work force
during the year under review.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
A Statement giving details of conservation of energy,
technology absorption, foreign exchange earnings and outgo
in accordance with Section 134(3)(m) read with the Rule 8
(3) of the Companies (Accounts) Rules, 2014 is enclosed as
Annexure – II and forms integral part of this Report.
NUMBER OF BOARD MEETINGS
The Board of Directors met five times in the year 2018-
19. The details of number of Board Meetings and the
attendance of the Directors are provided in the Corporate
Governance Report forming part of the Board Report.
COMMITTEES
The details of committee of Board have been given in the
Corporate Governance Report from integral part of Board
Report
COMPOSITION OF AUDIT COMMITTEE
The Board constituted the Audit Committee which
comprises of Sh. Y. R. Shah, Chairman, Smt. Aditi
Mehta and Dr. R. Chattopadhyay as members. All the
recommendations of Audit Committee have been
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
22
BOARD’S REPORT (CONTD..)accepted by the Board. More details on the committee are
given in the Corporate Governance Report forming part
of the Board Report.
RELATED PARTY TRANSACTIONS
All the related party transactions are entered on arm’s
length basis and in the ordinary course of business. The
Company has complied with all the applicable provisions
of the Companies Act, 2013 and SEBI (Listing Obligations
& Disclosure Requirements) Regulations, 2015 in this
regard. There is no materially significant related party
transaction with Promoters, Directors or Key Management
Personnel and any other related party which may have
potential conflict with the interest of the Company at
large. During the year, the Company has not entered into
any related party transactions under the Section 188 of
the Companies Act, 2013 and the particulars of contracts
or arrangements with related parties are Nil.
LOANS, GUARATEES OR INVESTMENTS
During the year under review, the Company has not given
any Loan, Guarantee or provided security in connection
with a loan nor has made any Investments under the
Section 186 of the Companies Act, 2013.
FIXED DEPOSITS
The Company has not accepted or renewed any fixed
deposits during the year under review and no fixed
deposit is outstanding for payment at the year ended 31st
March, 2019.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
In pursuance of Section 177 (9) of the Companies Act, 2013
and the regulation 22 of the SEBI (Listing Obligations &
Disclosure Requirements) Regulations, 2015, the Company
has in place a Vigil Mechanism/Whistle Blower Policy for
Directors and employees to report genuine concern. More
details pertaining to the same are given in the Corporate
Governance Report.
NOMINATION, REMUNERATION & EVALUATION POLICY
Pursuant to provisions of Section 178 of the Companies
Act, 2013 and SEBI (Listing Obligations & Disclosure
Requirements) Regulations, 2015, the Board of Directors
have approved Nomination, Remuneration & Evaluation
Policy for appointment, remuneration & evaluation of
the Directors, Key Management Personnel & Senior
Management Personnel. The details of the Nomination and
Remuneration committee, Nomination, Remuneration &
Evaluation Policy and Annual Evaluation carried out by the
Directors are given in the Corporate Governance Report.
PARTICULARS OF EMPLOYEES & ANALYSIS OF REMUNERATION
Particulars of employees and analysis of remuneration
as required under Section 197 (12) of the Companies Act,
2013 read with Rule 5 of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014
are enclosed as Annexure - III
EXTRACT OF ANNUAL RETURN
The extract of the Annual Return in Form MGT-9 as required
under section 92(3) of the Companies Act, 2013 read with
the Companies (Management and Administration Rules),
2014 is enclosed as Annexure - IV
OTHER DISCLOSURES
Details about risk management have been given in the
Management Discussions & Analysis.
There is no material changes and commitments affecting
the financial position of the Company which has occurred
between the end of the financial year and the date of the
report.
The Company does not have any subsidiary, joint venture
& associate company.
No significant and material order has been passed during
the year by the regulators or courts or tribunals which
can impact the going concern status and Company’s
operations in future.
The Company is having adequate Internal Financial
Control with reference to the Financial Statements.
The Internal complaints committee constituted under the
Sexual Harassment of Woman at Workplace (Prevention,
Prohibition and Redressal) Act, 2013 has informed that
during the year, the Company has not received any
complaint under the Act and no complaint was pending
at the beginning of the year. Accordingly, no complaint
was pending at the end of year under review.
The certain disclosures are common under Companies
Act, 2013 and SEBI (Listing Obligations & Disclosure
Requirements) Regulations, 2015 and the same are
disclosed in the Corporate Governance Report forming
part of this Report.
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
23
BOARD’S REPORT (CONTD..)DIRECTORS’ RESPONSIBILITY STATEMENT
Pursuant to sub-section 3 (c) of Section 134 of the
Companies Act, 2013, the Board of Directors of the
Company hereby state and confirm that:
(i) in the preparation of Annual Accounts, the applicable
accounting standards have been followed along with
proper explanation relating to material departures
have been given;
(ii) they have selected such accounting policies and
applied them consistently and made judgments and
estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the
Company at the end of the financial year and of the
profit or loss of the Company for that period;
(iii) they have taken proper and sufficient care for
the maintenance of adequate accounting records
in accordance with the provisions of this Act for
safeguarding the assets of the Company and for
preventing and detecting frauds and other irregularities,
(iv) they have prepared the Annual Accounts on a going
concern basis;
(v) they have laid down internal financial controls to
be followed by the Company and that such internal
financial controls are adequate and were operating
effectively; and
(vi) they have devised proper systems to ensure
compliance with the provisions of all applicable laws
and that such systems were adequate and operating
effectively.
ACKNOWLEDGEMENTS
Directors wish to express their grateful appreciation
for assistance and co-operation received from various
Departments of Central & State Governments and Banks
during the year under review. Your Directors also wish
to place on record their appreciation for the committed
services of all the associates and vendors of the Company.
For and on Behalf of the Board of Directors
R. L. NOLKHA
Chairman
(DIN – 00060746)
Place : Bhanwaria Kalan
Date : 10th August, 2019
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
24
ANNEXURE - ICSR ACTIVITIES
1. A brief outline of the company’s CSR policy, including
overview of projects or programs proposed to be
undertaken and a reference to the web-link to the
CSR policy and projects or programs.
The CSR Policy of the Company reflects the Company’s
philosophy on its social commitment and mission which
is designed to portray its obligation to be a responsible
corporate citizen and presents the strategies and
methods for undertaking social programs for well-being
and sustainable development of the local community in
which it operates. The Policy applies to all CSR initiatives
and activities taken up at the various work centers and
locations of the Company, for the benefit of various
segments of the society, with the emphasis on the under
privileged. Each CSR activity/project of the Company is
undertaken/executed either directly by the Company
or channelized through implementing agencies. In
compliance with the provisions of the Companies Act,
2013, the Company has framed a CSR Policy and the
same has been placed at the website of the Company
under the link http://nitinspinners.com/wp-content/
uploads/2018/06/CSR-Policy.pdf
2. The Composition of the CSR Committee. 1. Shri R. L. Nolkha, Chairman
2. Shri Dinesh Nolkha, Managing Director
3. Shri Y. R. Shah, Independent Director
4. Smt. Aditi Mehta, Independent Director
3. Average net profit of the company for last three
financial years (Amount in Lacs)
H 6896.44
4. Prescribed CSR Expenditure (two per cent. of the
amount as in item 3 above) (Amount in Lacs)
H 137.93
5. Details of CSR spent during the financial year.
(1) Total amount to be spent for the F.Y.
(Amount in Lacs)
(2) Amount unspent , if any;
(3) Manner in which the amount spent during the
financial year:
H 137.93
Nil
Specified as under
(Amt. in H)
S. No.
CSR Project or activity identified
Sector in which the Project is covered
Projects or programs(1) Local area or other(2) Specify the State and district where projects or programs was undertaken
Amount outlay
(budget) project or programs
wise
Amount spent on the projects
or programsSub-heads:
(1) Direct expenditure
on projects or programs.
(2) Overheads:
Cumulative expenditure upto to the
reporting period
Amount spent:Direct or through
implementing agency
1. Medical Aid to Animals Animal welfare Local AreaBhilwara (Rajasthan)
31,000 31,000 31,000 Implementing Agency – People
for Animals
2. Mukhymantri Jal Swavlamban Abhiyan
Conservation of Natural Resources
Local AreaBhilwara (Rajasthan)
11,000 11,000 11,000 Implementing Agency-State
Government
3. Contribution to Shri Ganesh Utsav Prabandh and Seva Samiti For Shivir for Health Check up
Health Care Local AreaBhilwara (Rajasthan)
51,000 51,000 51,000 Implementing Agency - Shri Ganesh Utsav Prabandh and
Seva Samiti
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
25
ANNEXURE - ICSR ACTIVITIES (Contd..)
(Amt. in H)
S. No.
CSR Project or activity identified
Sector in which the Project is covered
Projects or programs(1) Local area or other(2) Specify the State and district where projects or programs was undertaken
Amount outlay
(budget) project or programs
wise
Amount spent on the projects
or programsSub-heads:
(1) Direct expenditure
on projects or programs.
(2) Overheads:
Cumulative expenditure upto to the
reporting period
Amount spent:Direct or through
implementing agency
4. Contribution to CITI – CDRA for Cotton Development and Research Purpose
Rural Development
Local AreaBhilwara (Rajasthan)
1, 50,000 1, 50,000 1, 50,000 Implementing Agency- CITI –
CDRA
5. Construction of Woman Hostel
Empowering Women
Local AreaBhilwara (Rajasthan)
3, 60,00,000 93, 91,819 (Direct Expenditure)
3, 52,16,154 Direct
6. Contribution to Rajasthan Textile heritage week event
Promotion and Development of Traditional Arts and Handicrafts
Jaipur (Rajasthan)
25, 00,000 25, 00,000 25, 00,000 Implementing Agency-
Prasad Bidapa Associates
7. Contribution to Chittor Mahotsav
Promotion and Development of Traditional Arts and Handicrafts
Chittor (Rajasthan)
2,00,000 2,00,000 2,00,000 Implementing Agency- District
Collector Chittorgarh
8. Construction of Anicut Conservation of Natural Resources
Bassi Chittorgarh (Rajasthan)
19,25,000 19,11,364 19,11,364 Implementing Agency-
District Forest Officer, Begun
Total 4,08,68,000 1,42,46,183 4,00,70,518
The Company has spent H 142.46 Lacs against obligation of H 137.93 Lacs during the year 2018-19. Hence, there is No
shortfall in spending of CSR expenditure;
We hereby confirm that implementation and monitoring of the CSR Policy is in compliance with the CSR objectives and
Policy of the Company
Dinesh Nolkha R. L. Nolkha
Managing Director Chairman of CSR Committee
(DIN – 00054658) (DIN – 00060746)
Date : 10th August, 2019
Place : Bhanwaria Kalan
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
26
ANNEXURE-II
For and on Behalf of the Board of Directors
R. L. Nolkha
Chairman
(DIN – 00060746)
Date : 10th August, 2019
Place : Bhanwaria Kalan
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information pursuant to Rule 8 (3) of the Companies
(Accounts) Rules, 2014 under Section 134 (3) of the
Companies Act, 2013 and forming part of Board’s Report
for the year ended 31st March, 2019.
A. Conservation of Energy
(i) The steps taken or impact on conservation of energy
- The Company gives high priority for conservation of
energy in all fields. The Company has taken following
measures for energy saving :
a) Installation of Inverter on SA Fan and RA Fan of
Carding & Preparatory Humidification Plant.
b) Replacement of Spindles and Bobbins of Ring
Frames Machines from higher to lower weight.
c) Reduction in the leakage of compressed air and
air pressure during machine cleaning.
d) Converted DC System to AC System in Motors &
Invertors on two Machines of Trumac.
(ii) Steps taken by the Company for utilizing alternate
sources of energy -
As renewable/green energy initiatives, the Company
has installed additional 3.00 MW Roof Top Solar
Power Plant for captive consumption of Solar Power
at Begun Unit in addition to existing plant of 3.60 MW,
thus taking the aggregate capacity to 6.60 MW.
(iii) Capital Investments on energy conservation
equipments
Estimated expenditure on energy conservation
equipments is H 79.34 lacs. The Solar power plant was
installed on power purchase model and therefore the
Company has not made any Capital Investment on
the same.
B Technology Absorption
(1) The efforts made towards technology absorption :-
The technology is being used for development of
new products and for improvement in the production
process and quality of products.
(2) Benefits derived like product improvement, cost
reduction, product development or import substitute:-
The Company has been continuously improving the
quality of its existing products at reduced cost and
developed new products from time to time.
(3) No technology has been imported during the last
three years.
(4) Expenditure incurred on Research and Development during the year is as follows :(H in Lacs)
Particulars Current Year Previous Year
(a) Capital 0.00 0.00
(b) Recurring 184.77 178.02
Total (a+b) 184.77 178.02% to total turnover 0.15% 0.16%
(H in Lacs)
Particulars Current Year Previous Year
(a) Earnings 82236.46 71408.34
(b) Outgo
-Capital Goods 12978.12 -
-Recurring :- -Components, Spares Parts including Packing Material 1187.03 910.58
-Raw Materials 13811.51 7178.75
-Sales Commission, Overseas Freight & Others 1014.54 664.27
-Travelling 7.50 5.33
Foreign Exchange Earnings and Outgo
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
27
ANNEXURE - IIIStatement of Particulars of Employees pursuant to Section 197 of the Companies Act, 2013 read with Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
Details of top ten employees in terms of remuneration drawn :-
Name of Employee
Designation Remuneration (J Lacs)
Qualifications ExperienceYears
Commencement of employment
Whether Permanent/Contractual
AgeYears
LastEmployment
Sh. R.L. Nolkha
Chairman 132.62 FCA,FCS, FCMA
49 06.09.1997 Contractual 73 Managing Director BSL Ltd.
Sh. Dinesh Nolkha
Managing Director
123.23 FCA, FCMA 25 01.01.1996 Contractual 48 -
Sh. Nitin Nolakha
Executive Director
115.22 B.Com., MBA 20 01.10.1998 Contractual 43 -
Sh. Sandeep Garg
President (Operations)
35.40 B. Tech 28 01.04.2007 Permanent 48 ST Cotex
Sh. P. Maheshwari
Chief Financial Officer
29.04 B.Com, FCA 35 01.08.2006 Permanent 57 BSL Ltd.
Sh. Debasis Kumar Das Gupta
Vice President (Weaving)
28.33 M. Tech. (Tex.) 34 17.04.2018 Permanent 59 Nahar Ind.
Sh. Umesh Toshniwal
Vice President (Mktg.)
27.97 B.Com 26 01.04.1993 Permanent 47 -
Sh. Anil Kumar Jain
Vice President (Commercial)
25.35 B.Sc, ICWA,CS 30 03.03.2018 Permanent 53 Sutlej Textiles
Sh. Vivek Tripathi
General Manager (SQC)
21.52 M. Tech. (Tex.) 20 09.01.2010 Permanent 44 Nahar Fibres
Sh. Ratnesh Kumar
General Manager (Rotor Spinning)
21.46 B. Tech. (Tex.) 28 29.04.2008 Permanent 48 CLC Group
Sh. R.L. Nolkha, Sh. Dinesh Nolkha and Sh. Nitin Nolakha are related to each other and none of the other employees are related to any Director or
manager of the Company.
Notes:
1. None of the employees of the Company are covered under Rule 5 (2) (iii) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 as none of the employee is in receipt of remuneration in excess of remuneration drawn by Managing Director & Whole
Time Directors and holding more than 2% of the paid-up capital of the Company.
2. Except above, none of the person was employed for the full year and was in receipt of remuneration of H 1,02,00,000 or more and employed
for part of the year and was in receipt of remuneration aggregating to H 8,50,000/- or more per month.
Analysis of Managerial Remuneration
In pursuant to Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 the statistical analysis of the remuneration paid to Directors and
Key Managerial Personnel (KMP) as against other employees of the company and with respect to the performance of
the company (PAT) is given below:-
1. The ratio of the remuneration of each director to the median remuneration of the employees of the company for the
financial year 2018-19 :-
Name of Directors Ratio
Sh. R.L. Nolkha, Chairman 69:1
Sh. Dinesh Nolkha, Managing Director 64:1
Sh. Nitin Nolakha, Executive Director 60:1
Sh. Y. R. Shah, Non Executive Independent Director 0.78:1
Smt. Aditi Mehta, Non Executive Independent Director 0.73:1
Dr. R. Chattopadhyay, Non Executive Independent Director 0.84:1
Non Executive Independent Directors are being paid Sitting Fee.
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
28
ANNEXURE - III
Name of Directors & KMP % increase/(Decrease)
in remuneration
Sh. R.L. Nolkha, Chairman 22.85
Sh. Dinesh Nolkha, Managing Director 23.84
Sh. Nitin Nolakha, Executive Director 24.87
Sh. Y. R. Shah, Non Executive Independent Director 33.33
Smt. Aditi Mehta, Non Executive Independent Director 24.44
Dr. R. Chattopadhyay, Non Executive Independent Director 20.75
Sh. P. Maheshwari, Chief Financial Officer 18.91
Sh. Sudhir Garg, Company Secretary & GM (Legal) 22.76
3. The percentage increase in the median remuneration of employees in the financial year 2018-19 :- 20.19
4. The number of permanent employees on the rolls of company:- 3130
5. Average percentile increase already made in the salaries of employees other than the managerial personnel in the
last financial year and its comparison with the percentile increase in the managerial remuneration and justification
thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration :-
Average % increase in the salary of employees other than Managerial Personnel: - 13.83%
Average % increase in the Salary of the Managerial Personnel :- 23.83%
(The variable component of Salary i.e. Commission of Executive Directors increased due to increase in profit of
the Company and resulted into higher percent increase in salary of Managerial Personnel in comparison to other
employees)
6. We hereby confirm that the remuneration paid to Directors and employees are as per the remuneration policy of the
company
2. The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company
Secretary or Manager, if any, in the financial year 2018-19;
For and on Behalf of the Board of Directors
R. L. Nolkha
Date : 10th August, 2019 Chairman
Place : Bhanwaria Kalan (DIN – 00060746)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
29
ANNEXURE - IVForm No. MGT-9
EXTRACT OF ANNUAL RETURN
as on the financial year ended on 31.03.2019
[Pursuant of Section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies
(Management and Administration) Rule, 2014]
I. REGISTRATION AND OTHER DETAILS
III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES -
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
All the business activities contributing 10 % or more of the total turnover of the company shall be stated:-
i) CIN L17111RJ1992PLC006987
ii) Registration Date 15.10.1992
iii) Name of the Company NITIN SPINNERS LIMITED
iv) Category / Sub-Category of the Company COMPANY LIMITED BY SHARES/INDIAN NON
GOVERNMENT COMPANY
v) Address of the Registered office and Contact
details
16-17 KM. STONE, CHITTOR ROAD,
HAMIRGARH, BHILWARA - 311025 RAJASTHAN
PHONE NO. 01482-286110 TO 113
E-Mail: [email protected]
vi) Whether listed company YES
vii) Name, Address and Contract detail of
Registrar and Transfer Agent, if any
Bigshare Services Pvt Ltd, 1st Floor, Bharat Tin Works
Building, opp. Vasant Oasis, Makwana Road, Marol,
Andheri (E), Mumbai - 400059
Phone No. 022-62638200 Fax 022-62638299
Sl.
No.
Name and description of main
products / services
NIC Code of the Product/
service
% of total turnover of the
company
1 COTTON YARN 2601 79.21
2 COTTON KNITTED FABRIC 2351 14.33
Sl.
No.
Name and Address of the Company CIN / GLN Holding/Subsidiary/
Associate
% of Shares
Held
Applicable
Section
1 Nil N.A. N.A. N.A. N.A.
IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)
i) Category-wise Share Holding
Category of the Shareholders
No. of Share held at the beginning of the year
No. of Share held at the end of the year % Change during
the year
Demat Physical Total % of Total
Shares
Demat Physical Total % of Total
Shares
A. Promoters
(1) Indian
a) Individual/HUF 13040510 0 13040510 23.48 13652000 0 13652000 24.29 0.81
b) Central Govt.
c) State Govt(s)
d) Bodies Corp. 16755000 0 16755000 30.16 17728000 0 17728000 31.53 1.37
e) Banks / FI
f) Any Other
Sub-total (A)(1) :- 29795510 0 29795510 53.64 31380000 0 31380000 55.82 2.18
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
30
ANNEXURE - IVForm No. MGT-9 (Contd..)
Category of the Shareholders
No. of Share held at the beginning of the year
No. of Share held at the end of the year % Change during
the year
Demat Physical Total % of Total
Shares
Demat Physical Total % of Total
Shares
(2) Foreign
a) NRIs - Individuals
b) Other - Individual
c) Bodies Corp.
d) Banks / FI
e) Any Other
Sub-total (A)(2) :- 0 0 0 0 0 0 0 0 0
Total Shareholding of Promoter (A) = (A)(1)+(A)(2)
29795510 0 29795510 53.64 31380000 0 31380000 55.82 2.18
B. Public Shareholding
(1) Institutions
a) Mutual Funds 7373669 0 7373669 13.27 8916056 0 8916056 15.86 2.59
b) Banks / FI 111396 0 111396 0.20 21651 0 21651 0.04 -0.16
c) Central Govt.
d) State Govt(s)
e) Venture Capital Funds
f) Insurance Companies
g) FIIs 207994 0 207994 0.37 23000 0 23000 0.04 -0.33
h) Foreign Venture Capital Funds
i) Other - Foreign Portfolio Investor
94498 0 94498 0.17 0 0 0 0.00 -0.17
Sub-total (B)(1) :- 7787557 0 7787557 14.01 8960707 0 8960707 15.94 1.93
(2) Non-Institution
a) Bodies Corp.
i) Indian 2003165 0 2003165 3.61 992150 0 992150 1.76 -1.85
ii) Overseas 0 0 0 0.00 0 0 0 0.00 0.00
b) Individuals
i) Individual shareholders holding nominal capital upto H 1 Lacs
10426473 630 10427103 18.77 9593814 630 9594444 17.06 -1.71
ii) Individual shareholders holding nominal capital in excess of H 1 Lacs
4190868 0 4190868 7.54 4080503 0 4080503 7.26 -0.28
c) Others (specify)
i) Clearing Members
224582 0 224582 0.40 132932 0 132932 0.24 -0.16
ii) NRI 1113225 2450 1115675 2.01 1070814 2450 1073264 1.91 -0.10
iii) Trust 4500 0 4500 0.01 4000 0 4000 0.01 0.00
iv) NBFC registered with RBI
2750 0 2750 0.01 2000 0 2000 0.00 -0.01
Sub-total (B)(2) :- 17965563 3080 17968643 32.35 15876213 3080 15879293 28.24 -4.11
Total Public Shareholding (B)=(B)(1)+(B)(2)
25753120 3080 25756200 46.36 24836920 3080 24840000 44.18 -2.18
C. Shares held by Custodian for GDRs& ADRs
Grand Total (A+B+C) 55548630 3080 55551710 100.00 56216920 3080 56220000 100.00 0.00
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
31
ANNEXURE - IVForm No. MGT-9 (Contd..)
ii) Shareholding of Promoters
iii) Change in Promoter’s Shareholding :
SI No.
Shareholder’s Name Shareholding at the beginning of the year
Shareholding at the end of the year % Change in shareholding
during the year
No. of Shares
% of total shares of the
company
% of Shares Pledged /
Encumbered to total shares
No. of Shares
% of total shares of the
company
% of Shares Pledged /
Encumbered to total shares
1 RATAN LAL NOLKHA 5716000 10.29 Nil 6120000 10.89 Nil 0.60
2 SUSHILA DEVI NOLKHA 1650000 2.97 Nil 1650000 2.94 Nil -0.03
3 RATAN LAL NOLKHA HUF 1475000 2.65 Nil 1630000 2.90 Nil 0.25
4 DINESH NOLKHA 1153000 2.08 Nil 1153000 2.05 Nil -0.03
5 KRISHNA NOLKHA 265000 0.48 Nil 265000 0.47 Nil -0.01
6 PRATYUSH NOLKHA 253510 0.46 Nil 254000 0.45 Nil -0.01
7 DINESH NOLKHA HUF 355000 0.64 Nil 355000 0.63 Nil -0.01
8 NITIN NOLAKHA 1793000 3.23 Nil 1845000 3.28 Nil 0.05
9 RANJEETA NOLKHA 180000 0.32 Nil 180000 0.32 Nil 0.00
10 NITIN NOLAKHA HUF 200000 0.36 Nil 200000 0.36 Nil 0.00
11 REDIAL TRADING &
INVESTMENT PVT LTD
16755000 30.16 Nil 17728000 31.53 Nil 1.37
Total 29795510 53.64 Nil 31380000 55.82 Nil 2.18
SI No.
Shareholder's Name Shareholding Date Increase / (Decrease) in Shareholding
Reason Cumulative Shareholding during the year (01.04.2018
to 31.03.2019)
No. of Shares at the
beginning (01.04.2018)
/ end of the year
(31.03.2019)
% of total shares of the
company
No. of Shares
% of total Shares of the
Company
1 RATAN LAL NOLKHA 5716000 10.29 01.04.2018 5716000 10.29
04.10.2018 4000 Transfer 5720000 10.17
16.11.2018 400000 Transfer 6120000 10.89
6120000 10.89 31.03.2019 6120000 10.89
2 SUSHILA DEVI NOLKHA 1650000 2.97 01.04.2018 1650000 2.97
1650000 2.94 31.03.2019 1650000 2.94
3 RATAN LAL NOLKHA HUF 1475000 2.65 01.04.2018 1475000 2.65
22.06.2018 5000 Transfer 1480000 2.63
23.11.2018 150000 Transfer 1630000 2.90
1630000 2.90 31.03.2019 1630000 2.90
4 DINESH NOLKHA 1153000 2.08 01.04.2018 1153000 2.08
1153000 2.05 31.03.2019 1153000 2.05
5 KRISHNA NOLKHA 265000 0.48 01.04.2018 265000 0.48
265000 0.47 31.03.2019 265000 0.47
6 PRATYUSH NOLKHA 253510 0.46 01.04.2018 253510 0.46
27.07.2018 490 Transfer 254000 0.45
254000 0.45 31.03.2019 254000 0.45
7 DINESH NOLKHA HUF 355000 0.64 01.04.2018 355000 0.64
355000 0.63 31.03.2019 355000 0.63
8 NITIN NOLAKHA 1793000 3.23 01.04.2018 1793000 3.23
12.10.2018 2208 Transfer 1795208 3.19
30.11.2018 49792 Transfer 1845000 3.28
1845000 3.28 31.03.2019 1845000 3.28
9 RANJEETA NOLKHA 180000 0.32 01.04.2018 180000 0.32
180000 0.32 31.03.2019 180000 0.32
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
32
ANNEXURE - IVForm No. MGT-9 (Contd..)
(iv) Shareholding Pattern of top ten Shareholders (Other than Directors, Promoters and Holder of GDRs and
ADRs:
SI No.
Shareholder's Name Shareholding Date Increase / (Decrease) in Shareholding
Reason Cumulative Shareholding during the year (01.04.2018
to 31.03.2019)
No. of Shares at the
beginning (01.04.2018)
/ end of the year
(31.03.2019)
% of total shares of the
company
No. of Shares
% of total Shares of the
Company
10 NITIN NOLAKHA HUF 200000 0.36 01.04.2018 200000 0.36
200000 0.36 31.03.2019 200000 0.36
11 REDIAL TRADING &
INVESTMENT PVT LTD
16755000 30.16 01.04.2018 16755000 30.16
15.06.2018 668290 Allotment 17423290 30.99
29.06.2018 6710 Transfer 17430000 31.00
05.10.2018 15000 Transfer 17445000 31.03
12.10.2018 14000 Transfer 17459000 31.05
30.11.2018 269000 Transfer 17728000 31.53
17728000 31.53 31.03.2019 17728000 31.53
SI No.
Shareholder's Name Shareholding Date Increase / (Decrease) in Shareholding
Reason Cumulative Shareholding during the year (01.04.2018
to 31.03.2019)
No. of Shares at the
beginning (01.04.2018)
/ end of the year
(31.03.2019)
% of total shares of the
company
No. of Shares
% of total Shares of the
Company
1 ADITYA BIRLA SUN
LIFE TRUSTEE PRIVATE
LIMITED A/C ADITYA
BIRLA SUN LIFE SMALL
AND MIDCAP FUND
2405213 4.33 01.04.2018 2405213 4.33
18.05.2018 87000 Transfer 2492213 4.49
01.06.2018 70000 Transfer 2562213 4.61
08.06.2018 101800 Transfer 2664013 4.80
15.06.2018 23000 Transfer 2687013 4.78
22.06.2018 7200 Transfer 2694213 4.79
20.07.2018 11000 Transfer 2705213 4.81
27.07.2018 43500 Transfer 2748713 4.89
07.09.2018 56300 Transfer 2805013 4.99
28.09.2018 165000 Transfer 2970013 5.28
05.10.2018 29987 Transfer 3000000 5.34
12.10.2018 20000 Transfer 3020000 5.37
19.10.2018 37000 Transfer 3057000 5.44
09.11.2018 32300 Transfer 3089300 5.50
30.11.2018 10700 Transfer 3100000 5.51
04.01.2019 200000 Transfer 3300000 5.87
01.02.2019 10000 Transfer 3310000 5.89
08.02.2019 54000 Transfer 3364000 5.98
15.02.2019 10100 Transfer 3374100 6.00
29.03.2019 125000 Transfer 3499100 6.22
3499100 6.22 31.03.2019 3499100 6.22
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
33
SI No.
Shareholder's Name Shareholding Date Increase / (Decrease) in Shareholding
Reason Cumulative Shareholding during the year (01.04.2018
to 31.03.2019)
No. of Shares at the
beginning (01.04.2018)
/ end of the year
(31.03.2019)
% of total shares of the
company
No. of Shares
% of total Shares of the
Company
2 L&T MUTUAL FUND
TRUSTEE LIMITED - L&T
EMERGING BUSINESSES
FUND
2767456 6.04 01.04.2018 2767456 4.98
02.11.2018 25000 Transfer 2792456 4.97
2792456 5.03 31.03.2019 2792456 4.97
3 IDFC DYNAMIC EQUITY
FUND
1891000 3.40 01.04.2018 1891000 3.40
18.05.2018 9000 Transfer 1900000 3.42
22.06.2018 13964 Transfer 1913964 3.40
29.06.2018 6036 Transfer 1920000 3.42
06.07.2018 30000 Transfer 1950000 3.47
31.08.2018 310000 Transfer 2260000 4.02
26.10.2018 10000 Transfer 2270000 4.04
02.11.2018 5197 Transfer 2275197 4.05
07.12.2018 44410 Transfer 2319607 4.13
14.12.2018 22840 Transfer 2342447 4.17
28.12.2018 9790 Transfer 2352237 4.18
04.01.2019 27763 Transfer 2380000 4.23
25.01.2019 20000 Transfer 2400000 4.27
01.02.2019 9830 Transfer 2409830 4.29
08.02.2019 10170 Transfer 2420000 4.30
29.03.2019 4500 Transfer 2424500 4.31
2424500 4.31 31.03.2019 2424500 4.31
4 DOLLY KHANNA 587408 1.06 01.04.2018 0 - 587408 1.06
13.04.2018 -8000 Transfer 579408 1.04
20.04.2018 -6000 Transfer 573408 1.03
27.04.2018 -10000 Transfer 563408 1.01
18.05.2018 -18000 Transfer 545408 0.98
25.05.2018 -4000 Transfer 541408 0.97
13.07.2018 -2000 Transfer 539408 0.96
20.07.2018 -4000 Transfer 535408 0.95
27.07.2018 -6500 Transfer 528908 0.94
03.08.2018 -2000 Transfer 526908 0.94
10.08.2018 -22000 Transfer 504908 0.90
31.08.2018 -7000 Transfer 497908 0.89
14.09.2018 -16000 Transfer 481908 0.86
21.09.2018 -2000 Transfer 479908 0.85
28.09.2018 -6000 Transfer 473908 0.84
05.10.2018 -10470 Transfer 463438 0.82
12.10.2018 -6000 Transfer 457438 0.81
19.10.2018 -6000 Transfer 451438 0.80
26.10.2018 -28000 Transfer 423438 0.75
02.11.2018 -2500 Transfer 420938 0.75
16.11.2018 11000 Transfer 431938 0.77
14.12.2018 -2000 Transfer 429938 0.76
21.12.2018 -2000 Transfer 427938 0.76
28.12.2018 -2000 Transfer 425938 0.76
18.01.2019 -1000 Transfer 424938 0.76
25.01.2019 -7000 Transfer 417938 0.74
01.02.2019 -2000 Transfer 415938 0.74
ANNEXURE - IVForm No. MGT-9 (Contd..)
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
34
ANNEXURE - IVForm No. MGT-9 (Contd..)
SI No.
Shareholder's Name Shareholding Date Increase / (Decrease) in Shareholding
Reason Cumulative Shareholding during the year (01.04.2018
to 31.03.2019)
No. of Shares at the
beginning (01.04.2018)
/ end of the year
(31.03.2019)
% of total shares of the
company
No. of Shares
% of total Shares of the
Company
08.02.2019 -12000 Transfer 403938 0.72
15.02.2019 -15000 Transfer 388938 0.69
22.02.2019 -34000 Transfer 354938 0.63
01.03.2019 -4000 Transfer 350938 0.62
08.03.2019 -2000 Transfer 348938 0.62
15.03.2019 -8000 Transfer 340938 0.61
22.03.2019 -1500 Transfer 339438 0.60
29.03.2019 -10000 Transfer 329438 0.59
30.03.2019 -1000 Transfer 328438 0.58
328438 0.58 31.03.2019 328438 0.58
5 AJAY MANGLUNIA 57824 0.10 01.04.2018 57824 0.10
11.05.2018 41985 Transfer 99809 0.18
25.05.2018 91 Transfer 99900 0.18
08.06.2018 100 Transfer 100000 0.18
29.06.2018 25000 Transfer 125000 0.22
01.03.2019 7804 Transfer 132804 0.24
15.03.2019 47196 Transfer 180000 0.32
22.03.2019 20000 Transfer 200000 0.36
200000 0.36 31.03.2019 200000 0.36
6 ADITYA BIRLA SUN
LIFE TRUSTEE PRIVATE
LIMITED A/C ADITYA
BIRLA SUN LIFE
EMERGING LEADERS
FUND - SERIES 7
0 0.00 01.04.2018 0 0.00
16.11.2018 35000 Transfer 35000 0.06
23.11.2018 58000 Transfer 93000 0.17
14.12.2018 59000 Transfer 152000 0.27
28.12.2018 48000 Transfer 200000 0.36
200000 0.36 31.03.2019 200000 0.36
7 ASHOK DIWAN 186224 0.34 01.04.2018 186224 0.34
06.04.2018 -10737 Transfer 175487 0.32
20.04.2018 195 Transfer 175682 0.32
27.04.2018 1155 Transfer 176837 0.32
11.05.2018 300 Transfer 177137 0.32
18.05.2018 4395 Transfer 181532 0.33
25.05.2018 4299 Transfer 185831 0.33
01.06.2018 670 Transfer 186501 0.34
08.06.2018 2025 Transfer 188526 0.34
22.06.2018 893 Transfer 189419 0.34
29.06.2018 1002 Transfer 190421 0.34
06.07.2018 335 Transfer 190756 0.34
20.07.2018 1065 Transfer 191821 0.34
27.07.2018 935 Transfer 192756 0.34
24.08.2018 -5226 Transfer 187530 0.33
31.08.2018 -1923 Transfer 185607 0.33
07.09.2018 -2420 Transfer 183187 0.33
28.09.2018 1003 Transfer 184190 0.33
05.10.2018 2095 Transfer 186285 0.33
12.10.2018 2845 Transfer 189130 0.34
26.10.2018 780 Transfer 189910 0.34
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
35
ANNEXURE - IVForm No. MGT-9 (Contd..)
SI No.
Shareholder's Name Shareholding Date Increase / (Decrease) in Shareholding
Reason Cumulative Shareholding during the year (01.04.2018
to 31.03.2019)
No. of Shares at the
beginning (01.04.2018)
/ end of the year
(31.03.2019)
% of total shares of the
company
No. of Shares
% of total Shares of the
Company
02.11.2018 780 Transfer 190690 0.34
28.12.2018 -1684 Transfer 189006 0.34
31.12.2018 -4200 Transfer 184806 0.33
04.01.2019 -3240 Transfer 181566 0.32
18.01.2019 470 Transfer 182036 0.32
01.02.2019 325 Transfer 182361 0.32
08.02.2019 690 Transfer 183051 0.33
22.02.2019 2413 Transfer 185464 0.33
01.03.2019 2760 Transfer 188224 0.33
22.03.2019 840 Transfer 189064 0.34
29.03.2019 -8464 Transfer 180600 0.32
180600 0.32 31.03.2019 180600 0.32
8 P SHOBHA 175670 0.32 01.04.2018 175670 0.32
175670 0.31 31.03.2019 175670 0.31
9 LAKSHMENDRA KUMAR
AGARWAL
0 0.00 01.04.2018 0 0.00
29.06.2018 5971 Transfer 5971 0.01
06.07.2018 12963 Transfer 18934 0.03
13.07.2018 14096 Transfer 33030 0.06
20.07.2018 34422 Transfer 67452 0.12
27.07.2018 41493 Transfer 108945 0.19
05.10.2018 16055 Transfer 125000 0.22
125000 0.22 31.03.2019 125000 0.22
10 RAVI SHANKAR MARDA 114652 0.21 01.04.2018 0 - 114652 0.21
31.08.2018 4000 Transfer 118652 0.21
118652 0.21 31.03.2019 118652 0.21
v) Shareholding of Directors and Key Managerial Personnel :
SI No.
Shareholder's Name Shareholding Date Increase / (Decrease) in Shareholding
Reason Cumulative Shareholding during the year (01.04.2018
to 31.03.2019)
No. of Shares at the
beginning (01.04.2018)
/ end of the year
(31.03.2019)
% of total shares of the
company
No. of Shares
% of total Shares of the
Company
1 P. MAHESHWARI 1000 0.00 01.04.2018 1000 0
24.05.2018 500 Transfer 1500 0
1500 0.00 31.03.2019 1500 0
2 SUDHIR GARG 100 0.00 01.04.2018 0 N.A. 100 0
100 0.00 31.03.2019
Independent Directors do not hold any Share in the Company and Promoter Directors' Shareholding given at the
Point No. (iii) above
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
36
ANNEXURE - IVForm No. MGT-9 (Contd..)
(Amt. in H)
SI.
No.
Particulars of Remuneration Name of MD/WTD/Manager Total Amount
Sh. Ratan
lal Nolkha,
Chairman
Sh. Dinesh
Nolkha, MD
Sh. Nitin
Nolakha, ED
1 Gross Salary
a) Salary as per provisions contained
in section 17(1) of the Income-tax
Act, 1961
4960000.00 4140000.00 3450000.00 12550000.00
b) Value of perquisites u/s 17(2)
Income-Tax Act, 1961
113037.00 92649.00 64878.00 270564.00
c) Profit in lieu of salary under
section 17(3) Income-tax Act, 1961
0.00 0.00 0.00 0.00
2 Stock Option 0.00 0.00 0.00 0.003 Sweat Equity 0.00 0.00 0.00 0.004 Commision
- as 0.75% of Profit 7593600.00 7593600.00 7593600.00 22780800.00 - Others, specify 0.00 0.00 0.00 0.00
5 Contribution to PF 595200.00 496800.00 414000.00 1506000.00Total (A) 13261837.00 12323049.00 11522478.00 37107364.00Ceiling as per Act 101250900.00
V INDEBTNESS
Indebtness of the Company including interest outstanding / accrued but not due for payment
(Amt. in H)
Secured Loans
excluding deposits
Unsecured Loans Deposits Total Indebtness
Indebtness at the beginning of
the financial year i) Principal Amount 4491713480.00 0.00 0.00 4491713480.00
ii) Interest due but not paid 0.00 0.00 0.00 0.00
iii) Interest accrued but not due 116285.00 0.00 0.00 116285.00
Total (i+ii+iii) 4491829765.00 0.00 0.00 4491829765.00Change in Indebtness at the end
of the financial year 1. Addition 4624532643.00 80000000.00 0.00 4704532643.00
2. Reduction 511598840.00 80000000.00 0.00 591598840.00
Net Change 4112933803.00 0.00 0.00 4112933803.00Indebtness at the end of the
financial yeari) Principal Amount 8604747282.00 0.00 0.00 8604747282.00
ii) Interest due but not paid 0.00 0.00 0.00 0.00
iii) Interest accrued but not due 0.00 0.00 0.00 0.00
Total (i+ii+iii) 8604747282.00 0.00 0.00 8604747282.00
VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
A. Remuneration to Managing Directors, Whole-time Directors and/or Manager:
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
37
ANNEXURE - IVForm No. MGT-9 (Contd..)
B. Remuneration to other Directors:
C. Remuneration To Key Managerial Personnel Other than MD/Manager/WTD:
(Amt. in H)
SI.
No.
Particulars of Remuneration Name of Directors Total Amount
Shri Y. R.
Shah
Smt. Aditi
Mehta
Dr. R
Chattopadhyay
1 Independent Directors
1. Fee for attending Board
Committee Meetings
150000.00 140000.00 160000.00 450000.00
2. Commission 0.00 0.00 0.00 0.003. Others, please specify 0.00 0.00 0.00 0.00Total (1) 150000.00 140000.00 160000.00 450000.00
2 Other Non-executive Directors - - - -1. Fee for attending Board
Committee Meetings
- - - -
2. Commission - - - -3. Others, please specify - - - -Total (2) 0.00 0.00 0.00 0.00Total B = (1+2) 150000.00 140000.00 160000.00 450000.00Total Managerial Remuneration 150000.00 140000.00 160000.00 450000.00Ceiling as per the Act H 1 Lacs Per Meeting of Board or Committee thereof
(Amt. in H)
SI.
No.
Particulars of Remuneration Key Managerial Personnel Total Amount
CEO Company
Secretary
CFO
1 Gross Salary
a) Salary as per provisions
contained in section 17(1) of the
Income-tax Act, 1961
1187940.00 1865076.00 3053016.00
b) Value of perquisites u/s 17(2)
Income-tax Act, 1961
598949.00 815253.00 1414202.00
c) Profit in lieu of salary under
section 170(3) Income-tax Act,
1961
0.00 0.00 0.00
2 Stock Option 0.00 0.00 0.003 Sweat Equity 0.00 0.00 0.004 Commision 0.00 0.00 0.00
- as % of Profit 0.00 0.00 0.00 - Others, specify 0.00 0.00 0.00
5 Others- Contribution to PF 142553.00 223809.00 366362.00Total (A) 1929442.00 2904138.00 4833580.00Ceiling as per Act N.A.
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
38
ANNEXURE - IVForm No. MGT-9 (Contd..)
VII. PENALTIES / PUNISHMENT / COMPOUNDING OF OFFENCES:
Type Section
of the
Companies
Act
Brief
Description
Details of Penlty
/ Punishment /
Compounding Fees
imposed
Authority
[RD / NCLT
/ COURT]
Appeal
made, if
any (give
details)
A. COMPANY Penalty N.A. N.A. Nil N.A. N.A.
Punishment N.A. N.A. Nil N.A. N.A.
Compounding N.A. N.A. Nil N.A. N.A.
B. DIRECTORS Penalty N.A. N.A. Nil N.A. N.A.
Punishment N.A. N.A. Nil N.A. N.A.
Compounding N.A. N.A. Nil N.A. N.A.
C. OTHER OFFICERS IN DEFAULT Penalty N.A. N.A. Nil N.A. N.A.
Punishment N.A. N.A. Nil N.A. N.A.
Compounding N.A. N.A. Nil N.A. N.A.
For and on Behalf of the Board of Directors
R. L. Nolkha
Date : 10th August, 2019 Chairman
Place : Bhanwaria Kalan DIN - 00060746
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
39
Form No. MR-3
SECRETARIAL AUDIT REPORT
FOR THE FINANCIAL YEAR ENDED March 31, 2019
[Pursuant to section 204(1) of the Companies Act, 2013 and Rule No.9 of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014]
To,
The Members,
Nitin Spinners Limited
16-17 K. M. Stone, Chittor Road, Hamirgarh
Bhilwara – 311 001 (Rajasthan)
We have conducted the secretarial audit of the compliance
of applicable statutory provisions and the adherence
to good corporate practices by Nitin Spinners Limited
(hereinafter called “the Company”). Secretarial Audit was
conducted in a manner that provided us a reasonable
basis for evaluating the corporate conducts/statutory
compliances and expressing our opinion thereon.
Based on our verification of the Company’s books,
papers, minute books, forms and returns filed and
other records maintained by the Company and also the
information provided by the Company, its officers, agents
and authorized representatives during the conduct of
secretarial audit, we hereby report that in our opinion,
the Company has, during the audit period covering the
financial year ended on March 31, 2019 (‘Audit Period’)
complied with the statutory provisions listed hereunder
and also that the Company has proper Board-processes
and compliance-mechanism in place to the extent, in the
manner and subject to the reporting made hereinafter:
We have examined the books, papers, minute books,
forms and returns filed and other records maintained by
the Company for the financial year ended on March 31,
2019 according to the provisions of:
(i) The Companies Act, 2013 (the Act) and the rules
made thereunder;
(ii) The Securities Contracts (Regulation) Act, 1956
(‘SCRA’) and the rules made thereunder;
(iii) The Depositories Act, 1996 and the Regulations and
Bye-laws framed thereunder;
(iv) Foreign Exchange Management Act, 1999 and the
rules and regulations made thereunder to the extent of
Foreign Direct Investment, Overseas Direct Investment
and External Commercial Borrowings; (Not applicable
to the Company during the Audit Period)
(v) The following Regulations and Guidelines prescribed
under the Securities and Exchange Board of India Act,
1992 (‘SEBI Act’):-
(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)
Regulations, 2011;
(b) The Securities and Exchange Board of India
(Prohibition of Insider Trading) Regulations, 2015;
(c) The Securities and Exchange Board of India (Issue of
Capital and Disclosure Requirements) Regulations,
2009; (repealed w.e.f. 9th December, 2018)
(d) The Securities and Exchange Board of India (Issue of
Capital and Disclosure Requirements) Regulations,
2018 notified on 9th December, 2018; (Not applicable
to the Company during the Audit Period)
(e) The Securities and Exchange Board of India
(Share Based Employee Benefits) Regulations,
2014; (Not applicable to the Company during the
Audit Period)
(f) The Securities and Exchange Board of India (Issue
and Listing of Debt Securities) Regulations, 2008;
(Not applicable to the Company during the Audit
Period)
(g) The Securities and Exchange Board of India
(Registrars to an Issue and Share Transfer Agents)
Regulations, 1993 regarding the Companies Act
and dealing with client;
(h) The Securities and Exchange Board of India
(Delisting of Equity Shares) Regulations, 2009;
(Not applicable to the Company during the Audit
Period)
(i) The Securities and Exchange Board of India
(Buyback of Securities) Regulations, 1998; (repealed
w.e.f. 11th September, 2018); (Not applicable to the
Company during the Audit Period)
(j) The Securities and Exchange Board of India
(Buyback of Securities) Regulations, 2018 notified
on 11th September, 2018; (Not applicable to the
Company during the Audit Period)
(k) The Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements)
Regulations, 2015.
(vi) As confirmed by the management, there are no
sector specific laws that are applicable specifically to
the company.
We have also examined compliance with the applicable
clauses of the following:
i. Secretarial Standards issued by The Institute of
Company Secretaries of India;
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
40
ii. The Listing Agreements entered into by the Company
with BSE Limited and National Stock Exchange of
India Ltd.
During the period under review the Company has
complied with the provisions of the Act, Rules, Regulations,
Guidelines, Standards, etc. mentioned above.
We further report that
The Board of Directors of the Company is duly
constituted with proper balance of Executive Directors,
Non-Executive Directors and Independent Directors. The
changes in the composition of the Board of Directors that
took place during the period under review were carried
out in compliance with the provisions of the Act.
Adequate notice is given to all directors to schedule the
Board Meetings, agenda and detailed notes on agenda
were sent at least seven days in advance, and a system
exists for seeking and obtaining further information and
clarifications on the agenda items before the meeting and
for meaningful participation at the meeting.
Majority decision is carried through while the dissenting
members’ views, if any, are captured and recorded as part
of the minutes.
We further report that there are adequate systems and
processes in the company commensurate with the size and
operations of the company to monitor and ensure compliance
with applicable laws, rules, regulations and guidelines.
We further report that during the audit period the
company has:
(a) Duly passed the resolutions under section 180(1)
(a) and 180(1)(c) of the Act, read with its applicable
rules, as amended for borrowing limits to the extent
of H 1,500 Crores (Rupees One Thousand and Five
Hundred Crores Only);
(b) Allotted 6,68,290 Equity Shares of H 10/- each at an
issue price of H 120.50 per share to an entity belonging
to Promoter group on preferential basis under
Chapter VII of the Securities and Exchange Board of
India (Issue of Capital and Disclosure Requirements)
Regulations, 2009;
(c) Adopted new set of Regulations of Articles of
Association in accordance with provisions of the Act.
For V. M. & Associates
Company Secretaries
(ICSI Unique Code
P1984RJ039200)
CS Manoj Maheshwari
Partner
Place: Jaipur FCS 3355
Date: May 25, 2019 C P No. : 1971
Note: This report is to be read with our letter of even date
which is annexed as Annexure A and forms an integral
part of this report.
Form No. MR-3
SECRETARIAL AUDIT REPORT (CONTD..)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
41
ANNEXURE ATo,
The Members,
Nitin Spinners Limited
16-17 K. M. Stone, Chittor Road, Hamirgarh
Bhilwara – 311001 (Rajasthan).
Our report of even date is to be read along with this letter.
1. Maintenance of secretarial record is the responsibility
of the management of the company. Our responsibility
is to express an opinion on these secretarial records
based on our audit.
2. We have followed the audit practices and processes
as were appropriate to obtain reasonable assurance
about the correctness of the contents of the
Secretarial records. The verification was done on
test basis to ensure that correct facts are reflected in
secretarial records. We believe that the processes and
practices, we followed provide a reasonable basis for
our opinion.
3. We have not verified the correctness and
appropriateness of financial records and Books of
Accounts of the company.
4. Where ever required, we have obtained the Management
representation about the compliance of laws, rules and
regulations and happening of events etc.
5. The compliance of the provisions of Corporate and
other applicable laws, rules, regulations, standards is
the responsibility of management. Our examination was
limited to the verification of procedures on test basis.
6. The Secretarial Audit Report is neither an assurance
as to the future viability of the company nor of the
efficacy or effectiveness with which the management
has conducted the affairs of the company.
For V. M. & Associates
Company Secretaries
(ICSI Unique Code
P1984RJ039200)
CS Manoj Maheshwari
Partner
Place: Jaipur FCS 3355
Date: May 25, 2019 C P No. : 1971
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
42
CERTIFICATE OF NON-DISQUALIFICATION OF DIRECTORS
(Pursuant to Regulation 34(3) and Schedule V Para C clause (10)(i) of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015)
To,
The Members,
Nitin Spinners Limited
16-17,K.M.Stone
Chittor Road, Hamirgarh
Bhilwara-311001 (Rajasthan)
We have examined the relevant registers, records, forms, returns and disclosures received from the Directors of Nitin
Spinners Limited having CIN:L17111RJ1992PLC006987 and having registered office at 16-17,K.M.Stone, Chittor Road,
Hamirgarh, Bhilwara-311001 (Rajasthan) (hereinafter referred to as ‘the Company’), produced before us by the Company
for the purpose of issuing this Certificate, in accordance with Regulation 34(3) read with Schedule V Para-C Sub clause
10(i) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
In our opinion and to the best of our information and according to the verifications (including Directors Identification
Number (DIN) status at the portal www.mca.gov.in) as considered necessary and explanations furnished to us by the
Company & its officers, We hereby certify that none of the Directors on the Board of the Company as stated below for
the Financial Year ending on 31st March, 2019 have been debarred or disqualified from being appointed or continuing as
Directors of companies by the Securities and Exchange Board of India, Ministry of Corporate Affairs or any such other
Statutory Authority.
Sr.No Name of the Director DIN
1 Mr. Yeshwantlal Ratilal Shah 00019557
2 Mr. Dinesh Nolkha 00054658
3 Mr. Nitin Nolakha 00054707
4 Mr. Ratan Lal Nolkha 00060746
5 Mrs. Aditi Mehta 06917890
6 Mr. Rabisankar Chattopadhyay 06928729
Ensuring the eligibility of, for the appointment / continuity of every Director on the Board is the responsibility of the
management of the Company. Our responsibility is to express an opinion on these based on our verification. This
certificate is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with
which the management has conducted the affairs of the Company.
For V. M. & Associates
Company Secretaries
(ICSI Unique Code P1984RJ039200)
CS Manoj Maheshwari
Partner
Place: Jaipur FCS 3355
Date: May 25, 2019 C P No.: 1971
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
43
MANAGEMENT DISCUSSION & ANALYSIS
*Forecasted
(Source: World Bank)
Economic Scenario
Global
The global economic growth is anticipated at 3.1% in 2018
with East Asia and Pacific remaining one of the world’s
fastest-growing developing regions with a moderating
growth of 6% in 2019, on account of broadly stable
commodity prices, a moderation in global demand
and trade, and a gradual tightening of global financial
conditions. In the euro zone, the job market continued
to improve with unemployment rate dropping to 7.8%.
Further, retail sales accelerated in February demonstrating
a growth of 2.8% YoY, reflecting a strong economic
recovery. The growth was further driven by accelerating
growth in developed economies, a steady performance
in East Asia, and recovery from recession in several
developing and transition economies. Investment growth
on account of new investment in some commodity sectors
was also witnessed as global commodity prices partially
recovered from the steep losses of 2014–2015.
In the coming fiscal, the global economic growth is
anticipated at 2.9% in 2019 owing to, moderation in
International trade and manufacturing activity, elevating
trade tensions and substantial financial market pressures.
Further, slowing external demand, rising borrowing costs,
and persistent policy uncertainties which are expected
to weigh on the outlook for the emerging market and
developing economies. While developed market is
anticipated to grow at 1.9% in 2018-19, the rest of the region
is expected to grow at 5.2% as strong demand offsets the
negative impact of slowing exports. Despite slower global
trade growth and tighter external financing conditions,
domestic factors, particularly policy reforms, are anticipated
to bolster growth in the African region reaching 1.9% in
2019. These economies are required to focus on mobilizing
domestic resources, strengthening debt and investment
management practices and building more resilient macro-
fiscal frameworks. (Source: World Bank)
Industry Overview and Outlook
Global Textile and Apparel Industry
The global textiles and apparel trade stood at 764 Billion
USD and has grown at CAGR of 3.6% since 2005.Under
this, the apparel segment accounted for market share
of 58% while fabrics captured a share of 19% in the
market. China, during the year, emerged as the largest
exporter with 36% market share. India became the second
largest exporter with a market share of 5% followed by
Bangladesh and Germany.
Indian
The Asian Development Bank has projected India’s growth
forecast at 7.2% for 2018-19 as against 6.6% in 2017-18 owing
to moderation in global demand. The acceleration in GDP
reflects significant recovery of country from transition
shocks leading to strengthening investment and robust
private consumption. The country’s medium-term growth
prospects remain strong at 7.75%, aided by ongoing
structural reform and a favourable demographic dividend.
However, current account deficit worsened to 3% of GDP in
2018-19 before improving to around 2.5% in 2019-20. Further,
inflation is projected at 4.7% in 2018-19 as against 3.6% in
2017-18 owing to accelerating demand and rising fuel prices.
Core inflation rose to about 6% during the year as a result of
a tapering output gap and pass-through effects from higher
energy prices and exchange rate depreciation.
Growth of the economy is expected to rebound to 7.6% in
2020 as policy rates are cut and farmers receive income
support, bolstering domestic demand. Recent policy
measures by the government to improve the investment
climate and boost private consumption and investment
will also help India to lift economic growth in the next two
fiscal years. However, the growth forecast for India has
some downside risks such as moderation in global demand
as financial conditions tighten, uncertainty arising out of
global trade tensions and the weak economic outlook in
industrial countries. On the domestic front, growth could
suffer if tax revenue falls short or any disruption affects
the ongoing resolution of the twin problems of bank and
corporate balance sheets. However, India will continue to
be one of the fastest growing major economies in 2019-
20. (Source: ADB, Economic times)
Economic Growth
% G
row
th
2015
2.82.5
3.1
44
3.1
2.3
2.9
1.91.82.4
0
1
2
3
4
5
2016
Global Developed Markets
2017 2018 2019*
(Source: Asian Development Bank)
GDP
7.6
5
3.7
1.6
2.3
Inflation
India China (Year-on-year in %)
5
4
3
2
12017-18
*Projections
2017-18 2018-19*2019-20*
2018-19* 2019-20*
7.8
7.4
6.6
6.2
7
6.4
6.9
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
44
MANAGEMENT DISCUSSION & ANALYSIS (Contd..)
*Estimated
(Source: UN Comrade &Wazir Analysis)
Outlook
The industry is expected to reach USD 1000 Billion by 2025
growing at CAGR of 3.4%. While, the growth developed
countries’ market are expected to slow down, the large
emerging economies will emerge as the key drivers of the
industry growth. Also, China and India, with a large population
base, will be the fastest growing markets in the segment.
Indian Textile and Apparel Industry
India is the world’s largest producer of textiles after
China and the second largest employment generator
after agriculture. The textile industry contributes 10% to
the manufacturing production of India. The country has
abundance of natural resources like cotton, jute and silk
which gives favourable demographics for textile industry.
It is diversified with hand spun, hand woven textiles at
one end of the scale while capital intensive sophisticated
mills sector at the other end of the scale. This sector
contributes 13% to the export earnings of India.
As an industry the apparel sector significantly contributes
to the economy of a country. The apparel industry
promotes trade relations between different economies
beyond geographical boundaries and helps generate
revenues that contribute to the country’s GDP.The
introduction of technology has considerably changed
the global outlook towards apparel manufacturing and
a higher importance is laid on advertising, designing and
manufacturing of fashion accessories. Consumers these
days are more informed and educated about fashion
trends due to exposure to use of internet. (Source:
Economic Survey, Fibre2Fashion, Wazir analysis)
The domestic textiles and Apparel market is estimated to
be USD 100 billion in 2018-19 , growing at CAGR of 10%
since 2005-06.The apparel demand at US$74 billion has
dominated the domestic market with a share of about
75% in the total textile and apparel market. Moreover, it is
the largest exported category capturing a share of 46% in
the textile and apparel exports.
Outlook
The Domestic Textiles and Apparel trade is expected
to grow at CAGR of 20% and expected to reach USD
220 Billion by 2025.The demand is driven by rise in per-
capita income, favourable demographics and a shift
to branded product preference In the present times,
apparel manufacturing for domestic consumption is
moving towards a huge shift towards scale, evolution of
processes and systems, focus on higher compliance and
accountability, and an era of responsive supply-chain
facilitating faster turnaround.
Cotton Industry
The cotton crop production for 2018-19 (till January 2019)
is estimated at 330 lakh bales of 170 kgs each. The crop
estimate have been reduced for Telangana by 2.50 lakh
bales, Andhra Pradesh by 50,000 bales and Karnataka
by 2 lakh bales as the farmers in the Southern Zone have
uprooted their cotton plants due to moisture deficiency
as a result of which there is no scope for 3rd and 4th
pickings. The total cotton supply projected during the
months of October 2018 to January 2019 is 198.80 lakh
bales, which consists of the arrival of 170.32 lakh bales
and imports of 5.48 lakh bales up to 31st January 2019
and the opening stock at the beginning of the season
estimated at 23 lakh bales. However, noticeable cracks
have developed in land across Saurashtra region due to
lack of soil moisture following heat waves in the region.
This has made second and third picking of cotton flowers
impossible. Farmers have also started uprooting plants
and clearing the field for rabi crop sowing. This also poses
threat of spike in cotton prices in the near period.
1400
1200
1000
800
600
400
200
0
160
140
120
100
60
40
20
02016 2017 2018 2019* 2020* 2021* 2022* 2023*
Global and Domestic Textile Export (in $ billion)
860.06 903.6 948.8 996.2 1046 1098.3 1153.3 1210.9
54.462.6
72.183
95.5109.9
126.5
145.6
World Textile Exports Indian Textile Exports
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
45
* Estimated
(Source: Ministry of Textiles & Wazir Analysis)
Opportunity in the sector
• The rich availability of raw materials, skilled manpower
and relatively lower cost of production such as cotton,
wool, silk, jute provides India an edge over the other
countries.
• Substantial investments by the Government in
implementation of schemes such as SITP(Scheme for
Integrated Textile Parks) and Technology Upgradation
Fund(TUFS) provides a boost to the industry.
• Investment promotion scheme by State Government
which provides Interest and Power subsidy
• The current FDI policy allows 100% foreign direct
investment for the textile industry. The government also
supports free trade with ASEAN countries such as China,
Japan, Republic of Korea, Australia, New Zealand etc.
• The proposed agreement with European Union is
expected to bring a hike in the exports.
• The rapid growth of Indian E-commerce companies
provides ample opportunities to Indian Textile Industry.
• The textile ministry of India has allocated H 690 crore for
setting up 21 readymade garment manufacturing units in
seven states for upgradation of Indian textile sector.
Challenges faced by the sector
• Indian textile industry grapples with domestic issues
such as outdated technology, inflexible labour laws,
infrastructure bottlenecks, and a fragmented nature
of the industry.
• Volatility in Cotton Prices have significantly impacted
the exports of cotton and cotton yarn, pressurising
the margins of the spinning companies.
• Competition from other low cost neighbouring
countries such as Bangladesh, Vietnam, Indonesia and
Pakistan is the biggest threats to Indian textile industry.
(Source: IBEF, Review Article by Crimson Publishers,
Financial Express, Us Comrade & Hazir)
Company Overview
One of the leading players in the textile industry, Nitin
Spinners commenced its operations as commodity yarn
player, and has now expanded the operations to value
added yarns. The Company manufactures a range of
yarns, including open end yarns, multi-fold open end
yarns, ring spun combed yarns, multi-fold ring spun
yarns, compact yarns, fancy slub yarns, core spun yarns,
S and Z twist yarns, dyeable cheese cones and organic
cotton yarns and blends. Its product range in knitted
fabrics include single jersey, pique structures, inter-lock
structures, rib structures and three thread fleece. The
Company's products are applicable in manufacturing
products, such as apparel and garments, under garments,
terry towels, woven fabrics, home furnishings, carpets,
denim, industrial textiles and medical textiles among
others. Further, looking forward to a promising growth
in apparel sector, the company has forayed into finished
fabrics segment, thus being equipped to cater to all type
of fabric demand of apparel manufacturers.
Core Competencies
• Management team has rich experience in marketing &
textile manufacturing.
• Well-defined quality and process management
system.
• Favourable location of plants, near to cotton producing
belt and major consumption centres & ports.
• Qualified and experienced professionals with rich and
proven experience.
• Established systems for process and plant
management
MANAGEMENT DISCUSSION & ANALYSIS (Contd..)
India’s Domestic Textile and Apparel Market Size (US$ billion)
4
35 59
80 90 10050
CAGR 10%
CAGR 12%
67
15 17 19
7445
15
160
220
76 6
28
2005-06
Apparel
Technical Textiles
Total
Home Textiles
2010-11 2015-16 2017-18 2018-19* 2025-26(P)
211125
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
46
Key Financial Ratios & Performance
Particulars FY 2018-19 FY 2017-18 Explanation in case change
25% or more as compared
to Previous Year
Revenue (H in Lacs) 124251.05 114524.89 N.A.
EBITDA (H in Lacs) 18084.33 15717.39 N.A.
EPS 11.43 10.56 N.A.
Debtor Turnover 10.76 13.00 Higher Credit Cycle
Inventory Turnover 5.70 5.57 N.A.
Interest coverage Ratio 6.26 5.32 N.A.
Current ratio 1.43 1.97 Surplus Funds Deployed in
expansion Project
Debt Equity Ratio 1.40 0.87 New Loans for expansion
Project
Operating Profit Margin 14.55% 13.72% N.A.
Net Profit Margin 5.16% 4.57% N.A.
Return on Net Worth 13.29% 12.57%
Increase in the prices of raw material could
negatively impact the business profitability
The company thoroughly reviews the purchasing policy so as to
control the purchase price of the commodity. Further, company
also stores raw material to mitigate the impact of rising prices.
Company has global operations which involves
dealing in foreign currency. Any fluctuation in the
exchange rates could affect company’s profits and
revenues.
The company actively manages its currency rates exposures by
application of hedging principles.
Textile industry is a huge industry involving large
number of players. Inability of the company to face
the competition may affect its operations
The company has a team of experienced personnel who
effectively and efficiently manages the operations of the business.
They understand the market demand and provides products in
accordingly. This helps the company increase its customer base
and stand strong against the competition.
Implementation of any policy, unfavourable for
the business, may impact the operations of the
company.
Government have implemented various policies such as SITP,
TUFS, Make in India etc. which has provided boost to the industry
and company has successfully capitalised on it.
Company has operations in more than 50
countries across the globe. Lack of focus in any
of the countries could lead to reduction in market
presence in those countries.
32.07% of company’s revenue is derived from the domestic
market. Further, company efficiently manages its operations in the
international boundaries as well which is reflected in the revenue of
H 844.06 Crores earned from the international business.
For financial and product wise performance with respect to operational performance, please refer to “Financial Results”
and “Operational Review” section in the Board’s Report.
Risk Mitigation
MANAGEMENT DISCUSSION & ANALYSIS (Contd..)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
47
Environment and Safety
The need for environmentally clean and safe operations is
company’s key priority. The Company policy requires the
conduct of all operations in such a manner so as to ensure
the safety of all concerned, compliance of statutory and
industrial requirements for environment protection and
conservation of natural resources to the extent possible.
The Company has also been accredited with OHSAS
18001:2007 (Occupational Health & Safety Management
System) certification from British Standards India (BSI).
Human Resource
Employees, for Nitin, are the most valuable assets of the
organisation. Driven by strong ethics, quality, integrity and
team work, company works towards achievement of its
goals and fulfilment of the objectives. Further, company
takes various initiatives to improve the competencies and
skills of its employees and provide them opportunities
to build a career across ranks at Nitin. The company also
organises various training and development programs
to improve the performance of their employees which,
in addition to improving career of the employees, proves
beneficial to the company’s operations. The Company
has also been accredited with SA 8000:2014 (Social
Accountability System) certification from British Standards
India (BSI). During the year ended 31 March 2019, the
company had strength of 3130 employees in the work force.
Internal Control System and their Adequacy
The Company has appropriate systems for Internal Control.
The systems are improved and modified continuously
to meet with changes in business conditions, statutory
and accounting requirements. The Company has strong
Management Information System, which is an integral part
of control mechanism. The Audit Committee of Board of
Directors reviews the efficiency and effectiveness of
internal control systems and suggests the solution to
improve and strengthen. The Internal control system was
tested during the year and no material weakness in design
or operation was observed.
Cautionary Statements
Statement in this Management Discussion and Analysis
describing the Company’s objectives, projections,
estimates, expectations or predictions may be “forward-
looking statements” within the meaning of applicable laws
and regulations. Actual results could differ materially from
those expressed or implied. Important factors that could
make a difference to the Company’s operations include
raw material availability and prices, cyclical demand and
pricing in the Company’s principal markets, changes
in Government regulations, tax regimes, economic
developments within India and the countries in which the
Company conducts business and other incidental factors.
For and on Behalf of the Board of Directors
R. L. Nolkha
Date : 10th August, 2019 Chairman
Place : Bhanwaria Kalan (DIN – 00060746)
MANAGEMENT DISCUSSION & ANALYSIS (Contd..)
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
48
CORPORATE GOVERNANCE REPORT
The Composition of the Board of Directors, attendance at Board & last Annual General Meeting, number of other
Directorship, Committee Membership and Chairmanship are as under:-
Name of Directors Category of
Directorship
Board
Meetings
attended
out of 5
Meetings
Attendance
at last AGM
held on
22.09.2018
Directorship
in other
Companies
No. of other
Committees in
which Member or
Chairperson
Chairman Member
Sh. Ratan Lal Nolkha Promoter
Executive Director
5 Yes 4 Nil Nil
Sh. Dinesh Nolkha Promoter
Executive Director
5 Yes 3 Nil Nil
Sh. Nitin Nolakha Promoter
Executive Director
5 Yes 2 Nil Nil
Sh. Yeshwant Lal Ratilal
Shah
Independent Non-
Executive Director
4 Yes Nil Nil Nil
Dr. Rabisankar
Chattopadhyay
Independent Non-
Executive Director
5 No Nil Nil Nil
Smt. Aditi Mehta Independent Non-
Executive Director
4 No Nil Nil Nil
1. COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE
The Company’s philosophy on Corporate Governance
envisages attainment of high level of transparency,
accountability and integrity in all its facets including
the conduct of its business, its relationship with its
stakeholders, employees, customers, Government
and lenders.
2. BOARD OF DIRECTORS
Composition, Category and Attendance at Meetings
The Board of Directors of the Company consists
of eminent persons with considerable professional
expertise and experience in business and industry,
finance, management, legal and marketing. The Board
comprises of six Directors including one Woman
Director and composition of Board of Directors
of the Company is in conformity with Regulation
17(1) of the Securities Exchange Board of India
(Listing Obligations and Disclosure Requirements)
Regulations, 2015 (herein after referred as “Listing
Regulations”) and applicable provisions of the
Companies Act, 2013. The Company has 50% Non
Executive Directors, it has an Executive Chairman
and the numbers of Independent Directors are 50%
of the total number of Directors. The Independent
Directors with their diverse knowledge, experience
and expertise bring in their independent judgment in
the deliberation and decisions of the Board.
During the financial year 2018-19, five meetings of
the Board of Directors were held on 10.05.2018,
07.08.2018, 31.10.2018, 08.02.2019 and 30.03.2019 and
the maximum time gap between any two meetings
was not more than one hundred twenty days.
The 26th Annual General Meeting of the Company
was held on 22.09.2018.
None of the Directors of the Board serve as Members
of more than 10 Committees nor are they Chairman
of more than 5 Committees, as per requirements
of the Regulation 26(1) of the Listing Regulations.
Further, none of the Independent Directors serves
as an Independent Director in more than seven listed
companies and none of the Independent Director of
the Company is Whole Time Director in any other
Listed Company. None of the Director is a Director
in any listed entity other than Nitin Spinners Ltd.
Independent & Non Executive Directors are not
holding any share in the Company and no convertible
instrument has been issued by the Company. All the
three Executive Promoter Directors are related to
each other, Sh. R. L. Nolkha is father of Sh. Dinesh
Nolkha & Nitin Nolakha and Sh. Dinesh Nolkha & Nitin
Nolakha are brothers. It is hereby confirmed that in the
opinion of Board, the Independent Directors fulfill the
conditions specified under the “Listing Regulations”
and they are independent of Management.
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
49
CORPORATE GOVERNANCE REPORT (Contd..)
The Board has identified the following skills/
expertise/competencies fundamental for the effective
functioning of the Company which are currently
available with Board :-
Textile Business Understanding of textile
business dynamics, across
various geographical markets,
industry verticals and regulatory
jurisdictions
Strategy and
Planning
Appreciation of long-term trends,
strategic choice and experience in
guiding and leading management
team to make decisions in
uncertain environments.
Governance Experience in developing
governance practice, serving
the best interests of all
stakeholders, maintaining board
and management accountability,
building long term effective
stakeholder engagements and
driving corporate ethics and values.
Board Meeting Procedure
The Company’s Board Meetings are governed by a
structured agenda. The Board Meetings are generally
scheduled well in advance and the notice of each board
meeting is given in writing to each Director. The Board
members, in consultation with the Chairman, may bring
up any matter for the consideration of the Board. The
Board papers, comprising the agenda are circulated
well in advance before the meeting of the Board.
All statutory, significant and other material
information as specified in Part A of Schedule-II
under the regulation 17(8) of the Listing Regulations
are regularly made available to the Board, wherever
applicable. The Board also reviews periodically the
compliances of all applicable laws.
Board’s role, functions, responsibility and
accountability are clearly defined. In addition to
matters statutorily requiring Board’s approval, all major
decisions involving formulation, strategy and business
plans, annual operating and capital expenditure
budgets, new investments, compliance with statutory
regulatory requirements, major accounting provisions
etc. are considered by the Board.
3. AUDIT COMMITTEE
Your Company has an Audit Committee constituted
by the Board of Directors which acts as a link
between the management, auditors and the Board
and oversees the financial reporting process.
Broad terms of reference
The terms of reference of the Audit Committee are
aligned with the guidelines set out in the Regulation
18 read with Part C of schedule II of the Listing
Regulations and also with the provisions of Section
177 of the Companies Act, 2013. The terms of reference
broadly includes approval of annual Internal Audit
Plan, review of financial reporting processes, internal
control, risk management system, functioning of
whistle blower mechanism and governance processes,
discussions and approval of quarterly, half yearly
and annual financial statements/results, interaction
with statutory, secretarial, internal and cost auditors,
recommendation for appointment, remuneration and
terms of appointment of auditors, monitor related
party transactions, uses and application of funds
raised through issues etc.
Composition
The Audit Committee was constituted on 15th May,
2001. Presently, it comprises Shri Y.R. Shah, Smt. Aditi
Mehta and Dr. R. Chattopadhyay. All the members of
the committee are non-executive and independent
Directors. Sh. Y.R. Shah, Chairman of the Committee
is having requisite financial and accounting expertise
and all other members of the committee are finance
literate. The Chairman of the Audit Committee
was present at the last Annual General Meeting of
the Company held on 22nd September, 2018. The
composition of the Audit committee meets the
requirements of section 177 of the Companies Act,
2013 and Regulation 18 of the Listing Regulations.
Meetings and Attendance
The committee met four times during the financial
year 2018-19. The dates on which Audit Committee
Meetings were held are 10.05.2018, 07.08.2018,
31.10.2018 and 08.02.2019. The number of meetings
attended by each committee member during the year
was as under:-
Name of Member No. of Meetings
attended
Sh. Y.R. Shah 4
Smt. Aditi Mehta 4
Dr. R. Chattopadhyay 4
The Managing Director, CFO as well as the
representatives of the internal & the statutory auditors
are permanent invitees to the meeting. The Company
Secretary acts as secretary to the audit committee.
In terms of regulation 22 of the Listing Regulations
no personnel have been denied access to the audit
committee.
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
50
4. NOMINATION AND REMUNERATION COMMITTEE:
Brief Description of terms of reference
The Remuneration Committee was constituted
on 03.06.2005 and in order to comply with the
provisions of Section 178 of the Companies Act, 2013
& Listing Regulations the name of the committee has
been changed to “Nomination and Remuneration
Committee” w.e.f. 06.05.2014. The terms of reference
of the Committee broadly includes following:-
1. Formulation of the criteria for determining
qualifications, positive attributes and
independence of a director and recommend to
the Board a policy, relating to the remuneration of
the directors, key managerial personnel and other
employees;
2. Formulation of criteria for evaluation of
performance of the Independent Directors and
the Board of Directors and devising a policy on
Board diversity;
3. Identifying persons who are qualified to become
directors and who may be appointed in senior
management in accordance with the criteria
laid down, and recommend to the Board their
appointment and removal.
4. Decision about extension or continuation of term
of Independent Directors on the basis of report of
performance evaluation.
5. Recommend to the Board, all remuneration in
whatever form, payable to senior management.
Composition
The Committee constitutes Sh. Y. R. Shah, Smt. Aditi
Mehta and Dr. R. Chattopadhyay, all the members of
the Committee are Non-Executive & Independent
Directors. Sh. Y. R. Shah is Chairman of the Committee.
The composition of the Nomination and Remuneration
Committee meets the requirements of section 178 of
the Companies Act, 2013 and Regulation 19 of the
Listing Regulations. During the financial year 2018-
19, two meetings of the Committee were held on
10.05.2018 & 07.08.2018. The number of meetings
attended by each committee member during the year
was as under:-
Name of Member No. of Meetings
attended
Sh. Y.R. Shah 2
Smt. Aditi Mehta 2
Dr. R. Chattopadhyay 2
Performance Evaluations:-
The Board has formulated “Nomination, Remuneration
and Evaluation Policy” and the criteria for performance
evaluation broadly includes Leadership & stewardship
abilities, contributing to clearly define corporate
objectives & plans, Communication of expectations &
concerns clearly with subordinates, obtain adequate,
relevant & timely information from external sources,
review & approval achievement of strategic and
operational plans, objectives, budgets, regular
monitoring of corporate results against projections,
identify, monitor & mitigate significant corporate risks,
review management’s succession plan, independence
& independent views and judgement of independent
directors etc. The detailed Policy inter-alia including
criteria for performance evaluation is available under
web link http://nitinspinners.com/wp-content/
uploads/2018/06/Nomination-Remuneration-Policy.pdf
The Board of Directors carried out annual
performance evaluation of the Board, Committee
thereof and Directors as per the criteria laid down
in the “Nomination, Remuneration and Evaluation
Policy” and found performance satisfactory.
Remuneration of Directors
Payment of Sitting Fees to the Non Executive
Directors and Payment of Salary, Commission and
Perquisites to the Executive Directors is made in
accordance with industry norms and subject to the
overall ceilings imposed by the Companies Act, 2013
and other applicable statues.
The appointment of Chairman, Managing Director and
Executive Director is governed by resolution passed by
the Board of Directors and shareholders of the Company
at the respective meetings. They are paid remuneration
as per terms and conditions approved by the Board of
Directors and Shareholders on the recommendation of
Nomination and Remuneration Committee.
Non-Executive Directors do not draw any remuneration
except sitting fee of H 20,000/- for attending every
Board Meeting and H 10,000/- for attending every
Committee Meeting except for that the CSR Committee
Meetings. Total sitting fee of H 4,50,000/- was paid
during the financial year 2018-19.
CORPORATE GOVERNANCE REPORT (Contd..)
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REPORTS 20 FINANCIAL STATEMENTS 61
51
(H in Lacs)
SI.
No.
Name of Directors Category of
Directors
Basic
Salary
Contribution
to P.F.
Commission Others Total
1 Sh. R.L. Nolkha Promoter &
Executive Director
49.60 5.95 75.94 1.13 132.62
2 Sh. Dinesh Nolkha Promoter &
Executive Director
41.40 4.97 75.94 0.93 123.23
3 Sh. Nitin Nolakha Promoter &
Executive Director
34.50 4.14 75.94 0.65 115.22
Performance linked incentive – Commission.
Service contract, notice period, severance fee and stock option to Executive Directors - Nil
Details of Remuneration paid to Executive Directors
Details of Sitting Fee paid to Non-Executive Directors
SI.
No.
Name of Directors Category of Directors Sitting Fee (Amt.
In J)
1 Sh. Y. R. Shah Independent Non-Executive Director 150000.00
2 Smt. Aditi Mehta Independent Non-Executive Director 140000.00
3 Dr. R. Chattopadhyay Independent Non-Executive Director 160000.00
SI.
No.
Name of Directors Designation Nature of Directorship
1 Mr. Y.R. Shah Chairman Independent & Non-Executive
2 Mr. Dinesh Nolkha Member Promoter & Executive
3 Mr. Nitin Nolakha Member Promoter & Executive
Compliance Officer: - Mr. Sudhir Garg, Company Secretary & GM (Legal)
Designated E-mail for Investors’ Grievances - [email protected]
Details of Complaints received and status thereof:-
Five complaints received from Investors during the financial year 2018-19, were resolved to the satisfaction of
shareholders and there was no complaint pending at the end of the year.
The details of remuneration paid to Executive Directors during the financial year 2018-19 are as under:-
The Company has no pecuniary relationship or transactions with its Non-Executive Directors other than payment
of sitting fees to them for attending Board and Committee meetings. None of the Non-Executive Directors of the
Company is holding any share, stock option and convertible instrument in the Company.
5. STAKEHOLDERS RELATIONSHIP COMMITTEE
The “Share Transfer & Investors’ Grievance Committee” was constituted on 03.06.2005 and in compliance with the
provisions of Section 178 of the Companies Act, 2013 & Listing Regulations the Board has named the committee as
“Stake Holders Relationship Committee” w.e.f. 06.05.2014. The committee considers and approves various requests
for transfer, transmission, sub-division, consolidation, renewal, exchange, issue of new certificates in replacement of
old ones, Dematerialization/Rematerialization of Shares, non-receipt of declared Dividend, Annual Reports and to
redress the grievances of the investors as may be received from time to time. The Committee meets as and when
required and shares are transferred within 15 days from the date of receipt of valid transfer request. During the
financial year 2018-19, two meetings of the Committee were held on 07.08.2018 and 11.02.2019.
The Secretarial Department of the Company and Registrar & Transfer Agent, Bigshare Services Private Ltd., Mumbai
attend all the Grievance of the Shareholders and Investors received directly or through SEBI, Stock Exchanges,
Ministry of Corporate Affairs, Registrar of Companies, SCORES etc.
Composition
The composition of “Stake Holders Relationship Committee” is as under:
CORPORATE GOVERNANCE REPORT (Contd..)
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
52
6. General Body Meeting:-
(i) Location and Time of General Body Meetings:
The details of location, date and time of Annual General Meetings held during last three years are given as under :-
AGM Date Time Place Special Resolution(s) passed
24th
AGM
24.09.16 3.30 PM Nitin Spinners Limited
16-17 KM Stone, Chittor Road,
Hamirgarh, Bhilwara -311025
Re-appointment of Sh. Dinesh Nolkha,
Managing Director.
25th
AGM
04.09.17 3.30 PM Nitin Spinners Limited
16-17 KM Stone, Chittor Road,
Hamirgarh, Bhilwara -311025
1. Increase in Borrowing Power to H 1250
Crores u/s 180(1)(c) of the Companies
Act, 2013.
2. Creation of Security on increased
Borrowing Power u/s 180(1)(a) of the
Companies Act, 2013.
3. Raising of funds through Securities.
26th
AGM
22.09.18 3.30 PM Nitin Spinners Limited
16-17 KM Stone, Chittor Road,
Hamirgarh, Bhilwara -311025
1. Increase in Borrowing Power to H 1500
Crores u/s 180(1)(c) of the Companies
Act, 2013 .
2. Creation of Security on increased
Borrowing Power u/s 180(1)(a) of the
Companies Act, 2013.
3. Re-appointment of Sh. R. L. Nolkha,
Executive Chairman.
4. Re-appointment of Sh. Nitin Nolakha,
Executive Director.
5. Adoption of New set of Articles of
Association
6. Ratification of “Relevant Date”
(Preferential Issue of Equity Shares)
During the financial year 2018-19, no resolution has
been passed through Postal Ballot. Also, no business
is proposed to be conducted through postal ballot
at the ensuing Annual General Meeting.
7. INDEPENDENT DIRECTORS’ MEETING
During the year under review, the Independent
Directors met on February 08, 2019, inter-alia, to
discuss:
• Evaluation of the performance of Non Independent
Directors and the Board of Directors as a whole;
• Evaluation of the performance of the Chairman of
the Company taking into account the views of the
Executive and Non Executive Directors;
• Evaluation of the quality, content and timelines
of flow of information between the Management
and the Board that is necessary for the Board to
effectively and reasonably perform its duties.
All the Independent Directors were present at the
Meeting.
8. OTHER DISCLOSURES:
Details of Compliances:-
The Company has complied with all the requirements
of the Listing Regulations as well as SEBI regulations
and guidelines. During the last three years, no
penalties/strictures were imposed / passed on the
Company by Stock Exchanges or SEBI or any other
statutory authority on any matter related to capital
markets since the listing of the Company’s shares.
Related Party Transactions:-
All transactions entered into with Related Parties as
defined under the Companies Act, 2013 and regulation
23 of the Listing Regulations during the financial year
were in the ordinary course of business and on arms
length pricing basis and do not attract the provisions of
Section 188 of the Companies Act, 2013. There were no
materially significant transactions with related parties
during the financial year which were in conflict with the
interest of the Company. Suitable disclosure as required
by the Ind AS has been made in the notes to the Financial
Statements. The Board has approved a policy for related
CORPORATE GOVERNANCE REPORT (Contd..)
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REPORTS 20 FINANCIAL STATEMENTS 61
53
party transactions which has been uploaded on the
Company’s website under the link http://nitinspinners.
com/wp-content/uploads/2018/06/RELATED-PARTY-
TRANSACTION-POLICY.pdf
Code of Conduct:-
The code of conduct for Directors and Senior
Management as approved and amended by the Board
of Directors from time to time has been placed on
the website of the Company under the link http://
nitinspinners.com/wp-content/uploads/2019/04/
Code-of-Conduct-for-Directors.pdf. All Board
members and senior management personnel have
affirmed compliance with the code of conduct during
the year under review. In this regard, certificate of
Managing Director is given at the end of this report.
Insider Trading Code:-
The Company has adopted the code of Internal
Procedures and Conduct framed under the SEBI
(Prohibition of Insider Trading) Regulations, 2015, as
amended, inter alia, to prevent insider trading in the
shares of the Company.
Whistle Blower Policy/Vigil Mechanism:-
With the rapid expansion of business in terms of
volume, value and geography, various risks associated
with the business have also increased considerably.
One such risk identified is the risk of fraud &
misconduct. The Audit Committee is committed to
ensure fraud-free work environment and to this end
the Committee has laid down a Whistle Blower Policy
providing a platform to all the employee, vendors
and customers to report any suspected or confirmed
incident of fraud/misconduct. This policy is applicable
to all the directors, employees, vendors and customers
of the Company and it is posted on the website of the
Company under the link http://nitinspinners.com/wp-
content/uploads/2018/06/VIGIL-MECHANISM.pdf. It
provides for direct access to the Chairperson of audit
committee in appropriate or exceptional cases and no
employee was denied access to the Audit Committee.
Sexual Harassment of Women
The Company has constituted Internal Complaint
Committee under the Sexual Harassment of Women
at Workplace (Prevention, Prohibition & Redressal)
Act, 2013 and committee meet from time to time.
The committee has informed that no complaint was
pending at the beginning and end of the year and no
complaint of sexual harassment of women has been
received during the financial year 2018-19.
Familiarization Programme for Independent
Directors:-
On appointment, the concerned Director is issued
a Letter of Appointment setting out in detail, the
terms of appointment, duties, responsibilities and
expected time commitments. Each newly appointed
Independent Director is taken through a formal
induction program on the Company’s manufacturing,
marketing, finance and other important aspects. The
Company Secretary briefs the Director about their
legal and regulatory responsibilities as a Director.
During the year 2018-19, the Directors visited the
site of new unit at Chittor – Kota NH-27, Village -
Bhanwariya Kalan, Tehsil – Begun, Dist. – Chittorgarh –
312023 (Rajasthan) wherein the erection of machines
was going on. They were explained about the new
facilities to be created and estimated timeline for the
same. The Company has also constructed Girls Hostel
under Corporate Social Responsibility and all the
Directors visited the same.
Further, the Directors are regularly updated with
amendments in the provisions of the Companies Act,
2013, Listing Regulations etc. Besides this Directors
are updated on continuous basis in respect of Related
Party Transactions, Audit and Auditors.
The details of familiarization programme for
Independent Directors is available at the website
of the Company under the link http://nitinspinners.
com/wp-content/uploads/2019/04/Familiarization-
Programme-201.pdf
The Company is partly compliant with the
Discretionary requirements as provided in the Part
–E of Schedule – II under regulation 27(1) of the
Listing Regulations. It complies with the following
discretionary requirements :-
(i) Separate post of Chairperson and Chief Executive
Officer
(ii) Modified opinion(s) in Audit Report –To move
towards regime of financial statement with
unmodified audit opinion.
During the year the Company has raised funds of
H 805.29 Lacs through preferential issue of Equity
Shares to one of the Promoters of the Company and
the proceeds of the issue has been utilized for the
purpose for which it was raised.
During the year the Company has paid total fee of
H 16.76 Lacs to the Statutory Auditors towards Audit
Fee, Legal and other services.
CORPORATE GOVERNANCE REPORT (Contd..)
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
54
The details of commodity price risk and commodity
hedging activities has been given in Management &
Discussions Analysis.
There are no instances where Board has not accepted
the recommendation of any Committee of Board of
the Company.
The Company do not have any Subsidiary Company
9. MEANS OF COMMUNICATION
The main channel of communication to shareholders
is through Annual Report which inter-alia includes, the
Board Report, the Report on Corporate Governance
and Audited Financial Results.
Quarterly financial results are approved by the Board
of Directors and submitted to the Stock Exchanges.
The Quarterly financial results are published in one
prominent English and one/two vernacular language
newspaper such as the Business Standard and the
Rajasthan Patrika/the Dainik Bhaskar and Nafa Nuksan.
The website of the Company www.nitinspinners.com acts
as the primary source of information about the Company
which inter-alia displayed the annual/quarterly financial
results, official press/news release and Shareholding
pattern, of the Company. The same are also displayed on
the website of both the Stock Exchanges.
No presentation was made to institutional investors and
analysts during the financial year 2018-19.
10. GENERAL SHAREHOLDER INFORMATION
Shareholder Information:-
A. Date of AGM & Time & Venue 20th September, 2019 at 3.30 PM at the registered
office of the Company at 16-17 KM Stone, Chittor
Road, Hamirgarh, Bhilwara – 311025 (Rajasthan)
B. Date of Book Closure 14.09.2019 to 20.09.2019 (Both the days Inclusive)
C. Dividend Payment date Within 30 days from the date of AGM.
D. Financial Year April 1, 2019 to March 31, 2020
E. Tentative Financial Calendar for next Year for 2019-20:
F. Listing on Stock Exchange & Stock Code :
Period Date of Board Meeting
1st Quarter ending June, 19 Last week of July, 19 or first week of August, 19
2nd Quarter ending September, 19 Last week of October, 19 or First week of November, 19
3rd Quarter ending December, 19 Last week of January, 20 or First week of February, 20
Year ending 31st March, 20 April/May 2020
AGM for year ending 31st March, 20 August/September 2020
Name of Stock Exchange Address Stock Code
BSE Limited Phiroze Jeejeebhoy Towers Dalal Street,
Mumbai – 400 001
532698
National Stock Exchange of India Limited Exchange Plaza, Bandra Kurla Complex,
Bandra (E), Mumbai – 400 051
NITINSPIN
Month BSE NSE
High Low High Low
April, 2018 107.40 98.45 107.50 98.15
May, 2018 104.95 83.60 105.70 83.90
June, 2018 96.05 84.00 95.75 83.00
July, 2018 96.40 76.00 96.00 77.50
August, 2018 97.45 85.25 98.00 92.10
September, 2018 97.50 78.15 97.80 77.95
The applicable listing fee for the Financial Year 2019-20 has already been paid to both the Stock Exchanges
G. Stock Price Data :
CORPORATE GOVERNANCE REPORT (Contd..)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
55
Month BSE NSE
High Low High Low
October, 2018 85.40 68.00 85.50 63.80
November, 2018 92.00 80.00 91.00 79.65
December, 2018 96.50 81.00 99.40 81.00
January, 2019 97.00 82.00 97.25 81.90
February, 2019 90.00 72.50 94.90 72.05
March, 2019 94.00 77.00 94.50 76.50
H. Performance in comparison to Broad based Indices - BSE Sensex :-
I. Dematerialisation of Share and Liquidity:
The equity shares of the Company are compulsorily traded and settled in dematerialised form under ISIN
INE229H01012. The details of Shares under dematerialised and physical mode are as under:-
Particulars 31st March, 2019 31st March, 2018
No. of
Shares
% No. of
Shares
%
No. of Shares Dematerialised
-NSDL 5,08,00,760 90.36 4,99,09,656 89.84
-CDSL 54,16,160 09.63 56,38,974 10.15
No. of Shares in Physical Mode 3,080 0.01 3,080 0.01
Total 5,62,20,000 100.00 5,55,51,710 100.00
40000.00
39000.00
38000.00
37000.00
36000.00
35000.00
34000.00
33000.00 0.00
20.00
40.00
60.00
80.00SENSEX
SE
NS
EX
NSL RATE
100.00
120.00
April
, 2018
Month
May
, 2018
June
, 2018
July,
2018
Aug
ust,
2018
Septe
mber
, 2018
Oct
ober, 2
018
Nov
ember
, 2018
Dec
ember
, 2018
Janu
ary,
2018
Febru
ary,
2018
Mar
ch, 2
018
CORPORATE GOVERNANCE REPORT (Contd..)
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
56
J. Outstanding GDRs / ADRs / warrants Etc. Nil
K. Registrar & Share Transfer Agent:-
The Bigshare Services Private Limited is the Registrar and Share Transfer Agent (RTA) of the Company. The
Shareholders / Investors are requested to contact for all correspondence / queries at the following address:-
M/s Bigshare Services Private Limited
Unit : Nitin Spinners Limited
Address : 1st floor, Bharat Tin Works Building,
Opp. Vasant Oasis, Makwana Road
Marol, Andheri East,
Mumbai 40059, Maharashtra
Phone No. : 022-62638200
Fax No. : 022-62638299
Email : [email protected]
Web Site : http://www.bigshareonline.com
Share Transfer System
The transfer of shares in physical form is processed and completed by Bigshare Services Private Ltd., Mumbai
within a period of 15 days from the date of receipt thereof provided all the documents are in order and after
taking necessary approvals from the Company. In case of shares in electronic form, the transfers are processed by
NSDL/CDSL through respective Depository Participants. In compliance with the Listing regulations, a practicing
Company Secretary audits the System of Transfer and a Certificate to that effect is issued.
L. Distribution of Shareholding as on 31st March, 2019:
No. of Equity Shares held No. of
Shareholders
% to
Shareholders
No. of Shares % to Shares
Up to 500 17044 80.0375 2924138 5.2013
501 to 1,000 2059 9.6689 1713313 3.0475
1,001 to 2,000 990 4.6490 1525257 2.7131
2,001 to 3,000 403 1.8925 1033613 1.8385
3,001 to 4,000 171 0.8030 605454 1.0769
4,001 to 5,000 155 0.7279 732678 1.3032
5,001 to 10,000 267 1.2538 1966471 3.4978
10,001 & above 206 0.9674 45719076 81.3217
Total 21295 100.00 56220000 100.00
Facilities Reviewed Credit Rating Existing Rating
Long term Rating - Term Loan & Working Capital
(Fund Based)
BWR A (BWR A) Outlook – Positive BWR A (BWR A) Outlook – Stable
Short Term Ratings (Non Fund based) BWR A1 (BWR A One) BWR A1 (BWR A One)
M. Credit Ratings of the Company
During the year 2018-19, Brickwork Ratings India Pvt. Ltd. has reviewed the ratings of Bank Loan facilities of the
Company and following are credit ratings given by them :-
CORPORATE GOVERNANCE REPORT (Contd..)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
57
For and on Behalf of the Board of Directors
R. L. Nolkha
Date : 10th August, 2019 Chairman
Place : Bhanwaria Kalan (DIN – 00060746)
a) Plant Location 1) 16-17 KM Stone, Chittor Road,
Hamirgarh, Bhilwara – 311025 (Rajasthan)
2) (Unit – Begun) Chittor –Kota NH-27,
Village – Bhanwaria Kalan,
Tehsil-Begun Distt. Chittorgarh (Rajasthan)
b) Address for Correspondence Nitin Spinners Limited
16-17 Km. Stone, Chittor Road,
Hamirgarh, Bhilwara - 311025
Rajasthan
Phone : 01482-286110 to 286113
Fax No. : 01482-286117 & 286114
E-Mail : [email protected]
Website – www.nitinspinners.com
N Plant Location & Address for Correspondence
CORPORATE GOVERNANCE REPORT (Contd..)
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
58
COMPLIANCE CERTIFICATE
(Under Regulation 17(8) of the SEBI (Listing Obligations and Development) Regulations, 2015)
A) We have reviewed financial statements and cash flow
statement for the year ended 31st March, 2019 and
that to the best of our knowledge and belief:
(1) These statements do not contain any materially
untrue statement or omit any material fact or
contain statements that might be misleading.
(2) These statements together present a true and
fair view of the Company’s affairs and are in
compliance with existing accounting standards,
applicable laws and regulations.
B) There are, to the best of our knowledge and belief, no
transactions entered into by the company during the
year which are fraudulent, illegal or violative of the
Company’s Code of Conduct.
C) We accept responsibility for establishing and
maintaining internal controls for financial reporting
and that we have evaluated the effectiveness of the
internal control system of the Company pertaining
to financial reporting and we have disclosed to the
auditors and the audit committee, deficiencies in the
design or operation of such internal controls, if any, of
which we are aware and the steps we have taken or
propose to take rectify these deficiencies.
D) We have indicated to the auditors and the Audit
Committee:
(1) Significant changes in internal control over
financial reporting during the year;
(2) Significant changes in accounting policies during
the year and that the same have been disclosed
in the notes to the financial statements; and
(3) Instances of significant fraud of which we have
become aware and the involvement therein, if
any, of the management or an employee having a
significant role in the Company’s internal control
system over financial reporting.
(P. Maheshwari) (Dinesh Nolkha)
Chief Financial Officer Managing Director
PAN – ABAPM8005C DIN - 00054658
Place: Hamirgarh, Bhilwara
Date: 25th May, 2019
Declaration as required under regulation 34(3) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015
All Directors and Senior Management Personnel of the Company have affirmed compliance with the Code of Conduct
for Directors and Senior Management of Nitin Spinners Limited for the Financial Year ended 31st March, 2019.
DINESH NOLKHA
Place : Hamirgarh Bhilwara Managing Director
Date : 25th May, 2019 (DIN – 00054658)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
59
AUDITOR’S CERTIFICATE ON COMPLIANCE OF CORPORATE GOVERNANCE
To
The Members of Nitin Spinners Limited
We have examined the compliance of conditions of
corporate governance by Nitin Spinners Limited, for the
year ended 31st March, 2019 as stipulated in Regulation
34(3) of the SEBI (Listing Obligations & Disclosure
Requirements) Regulations, 2015.
The compliance of conditions of corporate governance
is the responsibility of management. Our examination
was limited to procedures and implementation thereof,
adopted by the Company for ensuring the compliance
of the conditions of corporate governance. It is neither
an audit nor an expression of opinion on the financial
statements of the Company.
In our opinion and to the best of our information and
according to the explanations given to us, we certify that
the Company has complied in all material respects with
the condition of corporate governance as stipulated in the
above-mentioned SEBI (Listing Obligations & Disclosure
Requirements) Regulations, 2015.
We state that no investor grievance is pending for a period
exceeding one month against the Company as per the records
maintained by the Stakeholders Relationship Committee.
We further state that such compliance is neither an
assurance as to the future viability of the Company nor the
efficiency or effectiveness with which the management
has conducted the affairs of the Company.
For Kalani & Company
Chartered Accountants
(Firm Reg. No. 000722C)
(S. P. Jhanwar)
Place : Bhilwara Partner
Date : 25th May, 2019 M. No. 074414
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
60
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
61
INDEPENDENT AUDITOR’S REPORT
To the Members of
Nitin Spinners Limited
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying Financial statements
of Nitin Spinners Limited (“the Company”), which comprise
the Balance Sheet as at March 31, 2019, the Statement of
Profit and Loss (including Other Comprehensive Income),
the Statement of Changes in Equity and the Statement
of Cash Flows for the year ended on that date, and a
summary of the significant accounting policies and other
explanatory information (hereinafter referred to as “the
financial statements”).
In our opinion and to the best of our information and
according to the explanations given to us, the aforesaid
financial statements give the information required by
Companies Act, 2013 (“the Act”) in the manner so required,
and give a true and fair view in conformity with the Indian
Accounting Standards prescribed under section 133 of
the Act read with the Companies (Indian Accounting
Standards) Rules, 2015 , as amended, (“Ind As” ) and other
accounting principles generally accepted in India, of the
state of affairs of the Company as at March 31, 2019, the
profit and total comprehensive income, changes in equity
and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the Financial Statements in
accordance with the Standards on Auditing (SAs) specified
under section 143(10) of the Companies Act, 2013 (“the
act”). Our responsibilities under those Standards are
further described in the Auditor’s Responsibilities for the
Audit of the Financial Statements section of our report.
We are independent of the Company in accordance with
the Code of Ethics issued by the Institute of Chartered
Accountants of India (ICAI) together with the independence
requirements that are relevant to our audit of the financial
statements under the provisions of the Act and the Rules
made thereunder, and we have fulfilled our other ethical
responsibilities in accordance with these requirements and
the ICAI’s Code of Ethics. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a
basis for our audit opinion on the financial statements.
Key Audit Matters
Key audit matters are those matters that, in our
professional judgment, were of most significance in our
audit of the financial statements of the current period.
These matters were addressed in the context of our audit
of the financial statements as a whole, and in forming
our opinion thereon, and we do not provide a separate
opinion on these matters. We have determined the
matters described below to be the key audit matters to
be communicated in our report.
Key Audit Matter How the matter was addressed in our audit
1. Valuation of Inventories
• The net carrying value of inventory as on 31st
March, 2019 is 15.86 % of Total Assets of the
company.
• Sales in the industry can be extremely volatile
with consumer demand changing significantly
(Seasonal) based on current trends. As a
result, there is a risk that the carrying value of
inventory exceeds its net realisable value.
Hence, we determined the valuation of inventories
as a key audit matter.
Related Disclosures:
Please refer to Note-6 for details of the accounting
policies of inventories and Note-6 of Notes to Financial
Statements for relevant disclosures of inventories.
Our Audit Procedure:
• We have performed the Inventory physical stock count on
sample basis as at 31st March, 2019. We attended inventory
counts at location, which is selected based on financial
significance and risk and we performed the following
procedures at each site:
(i) Selected a sample of inventory items and compared the
quantities we counted to the quantities recorded.
(ii) Observed a sample of management’s inventory count
procedures to assess compliance with Company’s policy,
and
(iii) Made inquiries regarding obsolete inventory items and
inspected the condition of items counted.
• We have also evaluated a selection of controls over
inventory existence across the company.
• Examining the Company’s historical trading patterns of
inventory sold at full price and inventory sold below full
price, together with the related margins achieved for each
product lines in order to gain comfort that stock has not
been sold below cost.
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
62
INDEPENDENT AUDITOR’S REPORT (CONTD..)
Key Audit Matter How the matter was addressed in our audit
• Evaluating the rationality of the inventory policies such as the
policy of inventory valuation and provision for obsolescence
and understanding whether the valuation of inventory was
performed in accordance with the Company’s policy.
• Analyzing the inventory aging report and net realizable
value of inventories.
• Inspecting the post period sales situation and evaluating
the net realizable value of measurement applied on aging
inventory in order to verify the evaluation accuracy of the
estimated inventory allowance by the Company and
• Assessing whether the disclosures of provision for
inventory valuation are appropriate.
2. Trade Receivables
• The recoverability of trade receivables and
the level of provisions for doubtful debts are
considered to be a significant risk due to the
pervasive nature of these balances to the
financial statements, and the importance of
cash collection with reference to the working
capital management of the business.
• At 31st March, 2019 the trade receivables
balances (net of provisions)consist of 8.41%
of the total amount of assets. Accordingly, we
determined audit of trade receivables as the
key audit matter.
Related Disclosures:
Please refer to Note-19of the accounting policies for
details of the accounting policies of trade receivable.
Our Audit Procedure:
• Assessed the design and implementation of key controls
around the monitoring of recoverability.
• Discussed with the management regarding the level and
ageing of trade receivables, along with the consistency and
appropriateness of receivables provisioning by assessing
recoverability with reference to amount received in respect
of trade receivables.
• In addition, we have considered the company’s previous
experience of bad debt exposure and the individual counter-
party credit risk.
• Tested these balances on a sample basis through agreement
to post period end invoicing and cash receipt.
• The accuracy and completeness was verified through,
analytical reviews and balance confirmation.
• Analyzing the aging schedule of trade receivable, past
collection records, industry boom and concentration of
customers’ credit risk.
3. Revenue Recognition
• Revenue is an important measure used to
evaluate the performance of the Company.
There is a risk that the revenue is presented for
amounts higher than what has been actually
generated by the Company. Consequently,
we considered revenue recognition to be a
significant key audit matter.
Related Disclosures:
Please refer to Note-11 of the accounting policies
for details of the accounting policies of revenue
recognition and Note-37 of Notes to Financial
Statements.
Our Audit Procedure:
• Assessing the design, implementation existence and
operating effectiveness of internal control procedures
implemented as well as test of details to ensure accurate
processing of revenue transactions.
• Inspecting underlying documentation for any book entries
which were considered to be material on a sample basis.
• Inspecting the key terms and conditions of agreements
with major customers on a sample basis to assess if there
were any terms and conditions that may have affected the
accounting treatment of the revenue recognition.
• The accuracy and completeness of revenue was verified
through, cut-off test, analytical reviews and balance
confirmation.
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
63
Key Audit Matter How the matter was addressed in our audit
4. Capital Expenditure
We focused on capital expenditure incurred
during the year as this represents significant
transaction for the year and involves certain
judgmental areas, such as capitalization of eligible
components of cost as per applicable financial
reporting standards; therefore, we have identified
this area as key audit matter.
Related Disclosures:
Please refer to Note-2 of the accounting policies
for details of the accounting policies of capital
expenditure.
As disclosed in Note -3 to the financial statements,
the Company has incurred significant amount for the
installation of new integrated textile unit during the
year for the enhancement of its production capacity.
Our Audit Procedures to assess Capital Expenditure include
the following:
• We obtained an understanding of Company’s process with
respect to capital expenditure and tested controls relevant
to such process.
• We performed substantive audit procedures through
inspection of related documents and supporting in relation
to the capitalized cost.
• We further assessed that the related disclosures provided
in financial statements are adequate in accordance with
applicable accounting standards and Companies Act, 2013.
Information Other than the Financial Statements and Auditor’s Report Thereon
The Company’s Board of Directors is responsible for
the preparation of the other information. The other
information comprises the information included in the
Management Discussion and Analysis, Board’s Report
including Annexures to Board’s Report, Corporate
Governance and Shareholder’s Information, but does not
include the financial statements and our auditor’s report
thereon.
Our opinion on the financial statements does not cover
the other information and we will not express any form of
assurance conclusion thereon.
In connection with our audit of the financial statements,
our responsibility is to read the other information
identified above and, in doing so, consider whether the
other information is materially inconsistent with the
financial statements or our knowledge obtained during the
course of our audit or otherwise appears to be materially
misstated. If, based on the work we have performed, we
conclude that there is material misstatement of these
other information; we are required to report that fact. We
have nothing to report in this regard.
Management’s Responsibility for the Financial
Statements
The Company’s Board of Directors is responsible for
the matters stated in Section 134(5) of the Companies
Act, 2013 (“the Act”) with respect to the preparation of
these financial statements that give a true and fair view
of the financial position, financial performance, total
comprehensive income, changes in equity and cash flows
of the Company in accordance with the Ind AS and other
accounting principles generally accepted in India. This
responsibility also includes maintenance of adequate
accounting records in accordance with the provisions of
the Act for safeguarding the assets of the Company and for
preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting
policies; making judgments and estimates that are
reasonable and prudent; and design, implementation and
maintenance of adequate internal financial controls, that
were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the
preparation and presentation of the financial statements
that give a true and fair view and are free from material
misstatement, whether due to fraud or error
In preparing the financial statements, management
is responsible for assessing the Company’s ability to
continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going
concern basis of accounting unless management either
intends to liquidate the Company or to cease operations,
or has no realistic alternative but to do so.
Those Board of Directors are responsible for overseeing
the Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial
Statements
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance
INDEPENDENT AUDITOR’S REPORT (CONTD..)
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
64
with SAs will always detect a material misstatement when
it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the
economic decisions of users taken on the basis of these
financial statements.
As part of an audit in accordance with SAs, we exercise
professional judgment and maintain professional
skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement
of the financial statements, whether due to fraud
or error, design and perform audit procedures
responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis
for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for
one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or
the override of internal control.
• Obtain an understanding of internal financial
controls relevant to the audit in order to design audit
procedures that are appropriate in the circumstances.
Under section 143(3)(i) of the Act, we are also
responsible for expressing our opinion on whether
the Company has adequate internal financial controls
system in place and the operating effectiveness of
such controls.
• Evaluate the appropriateness of accounting policies
used and the reasonableness of accounting estimates
and related disclosures made by management.
• Conclude on the appropriateness of management’s
use of the going concern basis of accounting and,
based on the audit evidence obtained, whether
a material uncertainty exists related to events or
conditions that may cast significant doubt on the
Company’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the
related disclosures in the financial statements or, if such
disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained
up to the date of our auditor’s report. However, future
events or conditions may cause the Company to cease to
continue as a going concern.
• Evaluate the overall presentation, structure and
content of the financial statements, including the
disclosures, and whether the financial statements
represent the underlying transactions and events in a
manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the
financial statements that, individually or in aggregate,
makes it probable that the economic decisions of a
reasonably knowledgeable user of the financial statements
may be influenced. We consider quantitative materiality
and qualitative factors in (i) planning the scope of our
audit work and in evaluating the results of our work; and
(ii) to evaluate the effect of any identified misstatements
in the financial statements.
We communicate with those charged with governance
regarding, among other matters, the planned scope
and timing of the audit and significant audit findings,
including any significant deficiencies in internal control
that we identify during our audit. We also provide
those charged with governance with a statement that
we have complied with relevant ethical requirements
regarding independence, and to communicate with them
all relationships and other matters that may reasonably
be thought to bear on our independence, and where
applicable, related safeguards.
From the matters communicated with those charged with
governance, we determine those matters that were of
most significance in the audit of the financial statements
of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report
unless law or regulation precludes public disclosure about
the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in
our report because the adverse consequences of doing
so would reasonably be expected to outweigh the public
interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1) As required by the Companies (Auditor’s Report)
Order, 2016(“the order) issued by the Central
Government in terms of Section 143(11) of the act,
we give in “Annexure I” a statement on the matters
specified in paragraph 3 and 4 of the Order
2) As required by section 143(3) of the Act, based on our
audit we report:
(a) We have sought and obtained all the information
and explanations, which to the best of our
knowledge and belief were necessary for the
purpose of our audit;
(b) In our opinion and to the best of our information
and according to the explanations given to us,
proper books of accounts as required by law have
been kept by the Company so far as appears from
our examination of those books;
(c) The Balance Sheet, the Statement of Profit
and Loss (including Other Comprehensive
Income), Statement of Changes in Equity and
INDEPENDENT AUDITOR’S REPORT (CONTD..)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
65
the Statement of Cash Flow dealt with by this
Report are in agreement with the relevant books
of account.
(d) In our opinion, the aforesaid financial statements
comply with the Ind AS specified under Section
133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014
(e) On the basis of written representations received
from the directors, as on March 31, 2019 and taken
on record by the Board of Directors, none of the
Directors are disqualified as on March 31, 2019,
from being appointed as a director in terms of
section 164 (2) of the Act.
(f) With respect to the adequacy of the internal
financial controls over financial reporting of the
Company and the operating effectiveness of such
controls, refer to Annexure ‘II’ to this report.
(g) With respect to the other matter to be included
in the Auditor’s Report in accordance with the
requirements of section 197(16) of the Act, as
amended:
In our opinion and to the best of our information
and according to the explanations given to us,
the remuneration paid by the Company to its
directors during the year is in accordance with
the provisions of section 197 of the Act.
(h) With respect to the other matters to be included in
the Auditor’s Report in accordance with Rule 11 of
the Companies (Audit and Auditors) Rules, 2014,
in our opinion and to the best of our information
and according to the explanations given to us:
i. The Company has disclosed the impact of
pending litigations on its financial position in
its financial statements. (Refer Note No.29)
ii. The Company did not have any long term
contracts including derivative contracts, for
which there were any material foreseeable
losses.
iii. There are no amounts which are required to
be transferred to the Investor Education and
Protection Fund by the Company.
For Kalani & Company.
Chartered Accountants
Firm Regn. No 000722C
S.P. Jhanwar
Partner
Membership No.- 074414
Place: Bhilwara
Date: 25-05-2019
INDEPENDENT AUDITOR’S REPORT (CONTD..)
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
66
ANNEXURE ‘I’ to the Independent Auditor’s Report
(Referred to in paragraph 2 under ‘Report on Other Legal and Regulatory Requirements’ section of our report to the Members of Nitin Spinners Limited of even date)
i. InrespectoftheCompany’sfixedassets:
(a) The Company has maintained proper records
showing full particulars, including quantitative
details and situation of fixed assets (Property,
Plant & Equipment).
(b) The fixed assets (Property, Plant & Equipment)
have been physically verified by the management
at reasonable intervals. According to the
information and explanations given to us, no
material discrepancies were noticed on such
verification.
(c) The title deeds of immovable properties are held
in the name of company.
ii. Physical verification of inventory has been conducted
during the year at reasonable intervals by management.
As informed to us no material discrepancies have
been noticed on such verification.
iii. The Company has not granted any loans, secured or
unsecured to any companies, firms, limited liability
partnership or other parties covered in register maintained
under Section 189 of the Companies Act, 2013.
iv. No loans have been given to parties covered under
section 185 of the Companies Act, 2013. The company
has not given any guarantee or provided any security
to any party covered under section 185 or 186 of
the Companies Act, 2013. In case of investments
provisions of section 185 and 186 of the Companies
Act 2013 has been complied.
v. The company has not accepted deposits from the
public within the meaning of Sections 73 to 76 of the
Companies Act, 2013 and the rules made there under,
hence this clause is not applicable.
vi. The maintenance of cost records has been prescribed
by the Central Government under section 148(1)
of the Companies Act, 2013, and as informed to us
such accounts and records have been so made and
maintained. However, we have not conducted a
detailed examination of the same.
vii. According to the information and explanations given
to us, in respect of statutory dues:
(a) Undisputed statutory dues including provident
fund, employee state insurance, income tax,
GST, custom duty, cess and other statutory dues
have generally been regularly deposited with the
appropriate authorities and there are no undisputed
dues outstanding as on 31st March 2019.
(b) Details of dues of Income Tax, Goods and Service Tax, Sales Tax, Service Tax, Excise Duty and Value Added Tax
which have not been deposited as at March 31, 2019 on account of dispute are given below:
S.N. Name of
Statute
Nature of
Dues
Period Forum where
the
dispute is
pending
Gross
Amount due
(J in Lacs.)
Amount
deposited
under protest/
adjusted by
tax authorities
(J in Lacs.)
Amount
not
deposited
(J in
Lacs.)
1. Central Excise Interest on
Excise Duty
2008 Supreme Court,
New Delhi
787.02 Nil 787.02
2. Central Excise Excise duty
and Penalty
2006-07 High Court,
Jodhpur
9.25 9.25 Nil
3. Customs Redemption
Fine
2009-10 CESTAT,
Ahmedabad
0.50 Nil 0.50
4. Raj VAT & CST
Act
Tax & Interest 2011-12 Dy.
Commissioner
(A),Ajmer
59.51 3.34 56.17
5. Raj VAT & CST
Act
Tax & Interest 2012-13 Dy.
Commissioner
(A),Ajmer
29.20 1.76 27.44
6. Raj VAT & CST
Act
Tax & Interest 2013-14 Dy.
Commissioner
(A),Ajmer
45.05 2.93 42.12
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
67
ANNEXURE ‘I’ to the Independent Auditor’s Report
S.N. Name of
Statute
Nature of
Dues
Period Forum where
the
dispute is
pending
Gross
Amount due
(J in Lacs.)
Amount
deposited
under protest/
adjusted by
tax authorities
(J in Lacs.)
Amount
not
deposited
(J in
Lacs.)
7. Raj VAT & CST
Act
Tax & Interest 2014-15 Dy.
Commissioner
(A),Ajmer
50.34 3.55 46.79
8. Raj. Vat Penalty 2013-14 Dy.
Commissioner
(A),Ajmer
613.32 Nil 613.32
9. Raj. Vat Penalty 2014-15 Dy.
Commissioner
(A),Ajmer
445.18 Nil 445.18
10. Entry Tax Tax & Interest 2015-16 Dy.
Commissioner
(A),Ajmer
50.28 3.20 47.08
Total 2089.65 24.03 2065.62
viii. In our opinion and according to the information
and explanations given to us, the Company has not
defaulted in repayment of loans or borrowings to
the financial institution, banks, government or due to
debenture holders.
ix. The Company has not raised any money by way of
initial public offer or further public offer. According
to the information and explanation given to us, the
money raised by the company by way of term loans
have been applied for the purpose for which they
were obtained.
x. To the best of our knowledge and according to the
information and explanations given to us, no fraud by
the Company or no material fraud on the Company by
its officers or employees has been noticed or reported
during the year.
xi. In our opinion and according to the information and
explanations given to us, the Company has paid/
provided managerial remuneration in accordance with
the requisite approvals mandated by the provisions of
section 197 read with Schedule V to the Act.
xii. The Company is not a Nidhi Company and hence
reporting under clause 3 (xii) of the Order is not
applicable to the Company.
xiii. The Company has complied with Section 177 and 188
of the Companies Act, 2013 where applicable, for all
transactions with the related parties and the details
of related party transactions have been disclosed in
the financial statements as required by the applicable
Indian Accounting Standards.
xiv.During the year, the Company has made preferential
allotment of shares. In our opinion and according
to the information and explanations given to us,
the Company has complied with the requirement
of section 42 of the Companies Act, 2013 and the
amount raised has been used for the purpose for
which the funds were raised.
xv. The Company has not entered into any non-cash
transactions with its Directors or persons connected
to its directors and hence provisions of section 192
of the Companies Act, 2013 are not applicable to the
Company.
xvi. The Company is not required to be registered under
section 45-IA of the Reserve Bank of India Act, 1934.
For Kalani & Company.
Chartered Accountants
Firm Regn. No. 000722C
S.P. Jhanwar
Partner
Membership No.- 074414
Place: Bhilwara
Date: 25th May, 2019
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
68
ANNEXURE ‘II’ to the Independent Auditor’s Report
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”).
We have audited the internal financial controls with
reference to financial statements of Nitin Spinners Limited
(“the Company”) as of March 31, 2019 in conjunction with
our audit of the financial statements of the Company for
the year ended on that date.
Management’s Responsibility for Internal Financial Controls
The Company’s management is responsible for establishing
and maintaining internal financial controls with reference
to financial statements based on the internal control over
financial reporting criteria established by the Company
considering the essential components of internal control
stated in the Guidance Note on Audit of Internal Financial
Controls over Financial Reporting issued by the Institute
of Chartered Accountants of India. These responsibilities
include the design, implementation and maintenance of
adequate internal financial controls that were operating
effectively for ensuring the orderly and efficient conduct
of its business, including adherence to company’s
policies, the safeguarding of its assets, the prevention
and detection of frauds and errors, the accuracy and
completeness of the accounting records, and the timely
preparation of reliable financial information, as required
under the Act.
Auditors’ Responsibility
Our responsibility is to express an opinion on the
Company's internal financial controls with reference to
financial statements based on our audit. We conducted
our audit in accordance with the Guidance Note on Audit
of Internal Financial Controls Over Financial Reporting
(the “Guidance Note”) and the Standards on Auditing,
issued by ICAI and deemed to be prescribed under
section 143(10) of the Companies Act, 2013, to the extent
applicable to an audit of internal financial controls, both
applicable to an audit of Internal Financial Controls and,
both issued by the Institute of Chartered Accountants of
India. Those Standards and the Guidance Note require
that we comply with ethical requirements and plan
and perform the audit to obtain reasonable assurance
about whether adequate internal financial controls with
reference to financial statements was established and
maintained and if such controls operated effectively in all
material respects.
Our audit involves performing procedures to obtain audit
evidence about the adequacy of the internal financial
controls system with reference to financial statements
and their operating effectiveness. Our audit of internal
financial controls over financial reporting included
obtaining an understanding of internal financial controls
over financial reporting, assessing the risk that a material
weakness exists, and testing and evaluating the design
and operating effectiveness of internal control based on
the assessed risk. The procedures selected depend on
the auditor’s judgment, including the assessment of the
risks of material misstatement of the financial statements,
whether due to fraud or error.
We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our audit
opinion on the Company’s internal financial controls with
reference to financial statements.
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial controls with reference
to financial statements is a process designed to provide
reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for
external purposes in accordance with generally accepted
accounting principles. A company's internal financial
controls with reference to Ind AS financial statements
includes those policies and procedures that (1) pertain
to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles,
and that receipts and expenditures of the company
are being made only in accordance with authorizations
of management and directors of the company; and (3)
provide reasonable assurance regarding prevention or
timely detection of unauthorised acquisition, use, or
disposition of the company's assets that could have a
material effect on the financial statements.
Inherent Limitations of Internal financialcontrolswithreferencetofinancialstatements
Because of the inherent limitations of internal financial
controls over financial reporting, including the possibility
of collusion or improper management override of controls,
material misstatements due to error or fraud may occur
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
69
ANNEXURE ‘II’ to the Independent Auditor’s Report
and not be detected. Also, projections of any evaluation
of the internal financial controls over financial reporting
to future periods are subject to the risk that the internal
financial control over financial reporting may become
inadequate because of changes in conditions, or that the
degree of compliance with the policies or procedures may
deteriorate.
Opinion
In our opinion, the Company has, in all material respects,
an adequate internal financial controls with reference to
financial statements and such internal financial controls
with reference to Ind AS financial statements were
operating effectively as at March 31, 2019, based on
the internal financial controls with reference to Ind AS
financial statements criteria established by the Company
considering the essential components of internal control
stated in the Guidance Note on Audit of Internal Financial
Controls over Financial Reporting issued by the Institute
of Chartered Accountants of India.
For Kalani & Company.
Chartered Accountants
Firm Regn. No 000722C
S.P. Jhanwar
Partner
Membership No.- 074414
Place: Bhilwara
Date: 25th May, 2019
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
70
BALANCE SHEET as at March 31, 2019
(H In Lacs)
Particulars Note
No.
As at
March 31, 2019
As at
March 31, 2018
ASSETS(1) Non-Current Assets (a) Property, Plant and Equipment 2 52,324.52 56,937.62 (b) Capital Work-in-Progress 3 46,819.64 424.62 (c) Other Intangible Assets 4 31.13 42.65 (d) Other Non-Current Assets 5 2,341.02 810.03 Total Non-Current Assets (A) 1,01,516.31 58,214.92 (2) Current Assets (a) Inventories 6 22,782.54 20,548.87 (b) Financial Assets (i) Trade Receivables 7 12,072.54 8,810.05 (ii) Cash and Cash Equivalents 8 275.01 10.01 (iii) Other Bank Balances 8A 28.02 19.73 (iv)Other Financial Assets 9 258.04 38.54 (c) Other Current Assets 10 6,695.83 5,217.04 Total Current Assets (B) 42,111.98 34,644.24 Total Assets (A+B) 1,43,628.29 92,859.16 EQUITY AND LIABILITIES(1) Equity (a) Equity Share Capital 11 5,622.00 5,555.17 (b) Other Equity 12 42,631.47 36,127.98 Total Equity (A) 48,253.47 41,683.15 (2) Liabilities Non-Current Liabilites (a) Financial Liabilities Borrowing 13 61,873.51 31,050.14 (b) Provisions 14 1,161.69 898.28 (c) Deferred Tax Liabilities (Net) 15 2,991.17 1,677.31 Total Non-Current Liabilites (B) 66,026.37 33,625.73 (3) Current Liabilites (a) Financial Liabilities (i) Borrowing 16 18,543.36 8,751.55 (ii) Trade Payables 17 - Due to Micro & Small Enterprises 101.37 - - Due to Others 3,442.15 2,556.60 (iii) Other Financial Liabilities 18 6,600.04 5,841.64 (b) Other Current Liabilities 19 269.78 233.07 (c) Provisions 20 114.86 96.46 (d) Current Tax Liabilities (Net) 21 276.89 70.96 Total Current Liabilites (C) 29,348.45 17,550.28 Total Liabilites (B+C) 95,374.82 51,176.01
Total Equity and Liabilities (A+B+C) 1,43,628.29 92,859.16 Significant Accounting Policy 1Disclosures and Additional informations 29-40
In terms of our report of even date For and on behalf of the Board
For KALANI & CO. R.L.NOLKHA DINESH NOLKHA
Chartered Accountants Chairman Managing Director
(Firm Reg. no. 000722C ) (DIN - 00060746) (DIN - 00054658)
S. P. JHANWAR P.MAHESHWARI SUDHIR GARG
Partner Chief Financial Officer Company Secretary & General Manager (Legal)
M.No. 074414 (PAN - ABAPM8005C) (PAN - ABBPK6037F)
Place : Hamirgarh, Bhilwara
Date : 25.05.2019
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
71
STATEMENT OF PROFIT AND LOSS for the year ended March 31, 2019
(H In Lacs)
ParticularsNote
No.
For the year
ended
March 31, 2019
For the year
ended
March 31, 2018
I Revenue from Operations 22 124251.05 114524.89
II Other Income 23 277.08 225.76
III Total Income (I+II) 124528.13 114750.65IV Expenses Cost of Materials Consumed 24 78879.25 71411.78
Purchase of Stock in Trade - -
Changes in Inventories of Finished Goods, Work-in-Progress and
Stock-in-Trade
25 (730.50) 1344.78
Employee Benefits Expense 26 6799.85 6065.30
Finance Cost 27 2890.37 2954.87
Depreciation & Amortisation Expense 2,4 5463.88 5619.01
Other Expenses 28 21495.20 20211.40
Total Expenses (IV) 114798.05 107607.14V ProfitbeforeExceptionalItems&Tax 9730.08 7143.51
VI Exceptional Items - -
VIIProfit/(Loss)BeforeTax(V-VI) 9730.08 7143.51VIIITax Expenses 1. Current Tax 3641.33 1597.64
2. Earlier Year (149.77) (514.25)
3. Deferred Tax (172.17) 821.53
IX Profit/(Loss)fortheperiodfromContinuingOperationsAfter
Tax (VII-VIII)
6410.69 5238.59
X Other Comprehensive Income 1 ItemsthatwillnotbereclassifiedtoProfitorLoss(NetofTax) Remeasurements of Defined Benefit Plans 9.06 60.96
Income tax related to Defined Benefit Plans (3.17) (21.10)
5.89 39.86 2 Itemsthatwillbereclassifiedtoprofitorloss(NetofTax) Change in Fair Value of Effective portion of Cash Flow Hedge 248.64 (255.95)
Tax on Cash Flow Hedge Recognised during the year (86.88) 88.58
161.76 (167.37) Total Other Comprehensive Income for the year, net of Income
Tax
167.65 (127.51)
XI Total Comprehensive Income for the period (IX+X) 6578.34 5111.08XII Earning Per Equity Share (1) Basic 11.43 10.56 (2) Diluted 11.43 10.56Significant Accounting Policy 1
Disclosures and Additional informations 29-40
In terms of our report of even date For and on behalf of the Board
For KALANI & CO. R.L.NOLKHA DINESH NOLKHA
Chartered Accountants Chairman Managing Director
(Firm Reg. no. 000722C ) (DIN - 00060746) (DIN - 00054658)
S. P. JHANWAR P.MAHESHWARI SUDHIR GARG
Partner Chief Financial Officer Company Secretary & General Manager (Legal)
M.No. 074414 (PAN - ABAPM8005C) (PAN - ABBPK6037F)
Place : Hamirgarh, Bhilwara
Date : 25.05.2019
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
72
CASH FLOW STATEMENTfor the year ended March 31, 2019
(H In Lacs)
Particulars For the year
ended
March 31, 2019
For the year
ended
March 31, 2018
(A) CASH FLOW FROM OPERATING ACTIVITIES : NetProfitBeforeTax&ExceptionalItems 9730.08 7143.51 Adjustments for :- Depreciation 5463.88 5619.01
Interest Expenditure 2890.37 2954.87
Loss/ (Profit) on sale of Property, Plant & Equipment 23.93 0.41
Actuarial (loss)/gains on Defined Benefit Obligations 9.06 60.96
OperatingProfitBeforeWorkingCapitalChanges(1) 18117.32 15778.76 Adjustments for :- Decrease/( Increase) Inventories (2233.67) (3547.05)
Decrease/ (Increase) Trade Receivables (3262.49) (3977.34)
Decrease/ (Increase) Other Current & Non Current Assets (1932.24) (751.91)
Increase/(Decrease) Current & Non Current Liabilities 1573.87 637.72
Total Adjustments (2) (5854.53) (7638.58) Cash Generated from Operations (1-2) 12262.79 8140.18 Less : Taxes Paid 1889.66 1510.86
Net Cash Generated from Operating Activities (A) 10373.13 6629.32 (B) CASH FLOW FROM INVESTING ACTIVITIES: Purchase of Property, Plant & Equipment (892.31) (1252.10)
Capital WIP including Capital Advances (47476.89) (763.11)
Sale of Property, Plant & Equipment 29.12 1.67
Net Cash Generated/(used) in Investing Activities (B) (48340.08) (2013.54)(C) CASH FLOW FROM FINANCING ACTIVITIES: Proceeds from /(Repayment) of Short Term Borrowing (Net) 9791.81 (2469.92)
Proceeds from Long Term Borrowings 36453.51 -
Repayment of Long Term Borrowings (5114.99) (9436.94)
Interest Paid (2890.37) (2954.87)
Proceeds from issue of Shares 805.30 11193.70
Equity Issue Expenses - (388.20)
Dividend Paid (674.64) (550.01)
Tax on Dividend Paid (138.67) (111.97)
Net Cash Generated/(used) From Financing Activities (C) 38231.95 (4718.21) Net Increase / (Decrease) in Cash & Cash Equivalent (A+B+C) 265.00 (102.43) Opening Balance of Cash & Cash Equivalent 10.01 112.44
Closing Balance of Cash & Cash Equivalent 275.01 10.01
In terms of our report of even date For and on behalf of the Board
For KALANI & CO. R.L.NOLKHA DINESH NOLKHA
Chartered Accountants Chairman Managing Director
(Firm Reg. no. 000722C ) (DIN - 00060746) (DIN - 00054658)
S. P. JHANWAR P.MAHESHWARI SUDHIR GARG
Partner Chief Financial Officer Company Secretary & General Manager (Legal)
M.No. 074414 (PAN - ABAPM8005C) (PAN - ABBPK6037F)
Place : Hamirgarh, Bhilwara
Date : 25.05.2019
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
73
STATEMENT OF CHANGES IN EQUITY for the year ended March 31, 2019
Particulars As At 31st March 2019 As At 31st March 2018
Number (J In Lacs) Number (J In Lacs)
Equity Share CapitalBalance at the beginning of reporting period 55551710 5555.17 45833945 4583.39
Add: Shares issued during the year 668290 66.83 9717765 971.78
Balance at the closing of reporting period 56220000 5622.00 55551710 5555.17
(H In Lacs)
Particulars Reserves & Surplus Other Reserves
TotalCapital Redemption
Reserve
Securities Premium
General Reserve
Retained Earning
Effective Portion of Cash Flow Hedge
Reserve
Balance as at 1st April 2017 150.00 2766.73 3000.00 15777.53 150.90 21845.16
Profit for the year ended 31st March,2018
5238.59 5238.59
Other Comprehensive Income/ (Expenses) (OCI)
(a) Remeasurement of Defined Benefit obligation (Net of Tax)
39.86 39.86
(b) Adjustment for Effective portion of Cash Flow Hedge (Net of Tax)
(167.37) (167.37)
Dividends (Including Dividend Tax)
(661.98) (661.98)
Security Premium 10221.92 10221.92
Equity Issue Expenses (388.20) (388.20)
Transfer to General Reserve 1000.00 (1000.00) -
Balance as at 31st March 2018 150.00 12988.65 4000.00 19005.80 (16.47) 36127.98
Profit for the year ended 31st March,2019
6410.69 6410.69
Other Comprehensive Income/ (Expenses) (OCI)
(a) Remeasurement of Defined Benefit obligation (Net of Tax)
5.89 5.89
(b) Adjustment for Effective portion of Cash Flow Hedge (Net of Tax)
161.75 161.75
Dividends (Including Dividend Tax)
(813.31) (813.31)
Security Premium 738.47 738.47
Transfer to General Reserve 1000.00 (1000.00) -
Balance as at 31st March 2019 150.00 13727.12 5000.00 23609.07 145.28 42631.47
In terms of our report of even date For and on behalf of the Board
For KALANI & CO. R.L.NOLKHA DINESH NOLKHA
Chartered Accountants Chairman Managing Director
(Firm Reg. no. 000722C ) (DIN - 00060746) (DIN - 00054658)
S. P. JHANWAR P.MAHESHWARI SUDHIR GARG
Partner Chief Financial Officer Company Secretary & General Manager (Legal)
M.No. 074414 (PAN - ABAPM8005C) (PAN - ABBPK6037F)
Place : Hamirgarh, Bhilwara
Date : 25.05.2019
A. Equity Share Capital
B. Other Equity
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
74
NoteNo.1-CompanyInformationandSignificantAccountingPolicy
NOTES TO THE FINANCIAL STATEMENTS
A. Corporate Overview
Nitin Spinners Limited (the “Company”), incorporated
on 15th October, 1992, is a Company domiciled in India
and limited by shares (CIN: L17111RJ1992PLC006987).
The address of the Company’s registered office
is 16-17 Km. Stone, Chittor Road, Hamirgarh, and
Bhilwara-(Raj 311025). The company is engaged in
manufacturing of Cotton Yarn and Knitted Fabrics.
The company is listed at National Stock Exchange of
India Limited and at BSE Limited.
B. Basis of Preparation
These Separate Financial Statements are prepared
on Going Concern basis following Accrual basis of
accounting and comply in all material aspects with
the Indian Accounting Standards (Ind AS) notified
under the Companies (Indian Accounting Standards)
Rules, 2015 and subsequent amendments thereto,
the Companies Act, 2013 (to the extent applicable),
applicable provisions of the Companies Act, 1956.
1. Basis of Measurement/Use of Estimates
(i) The Financial Statements are prepared
on accrual basis under the historical cost
convention except certain financial assets and
liabilities (including derivatives instruments)
that are measured at fair value.
Historical cost is generally based on the fair
value of the consideration given in exchange
for goods and services.
Fair value is the price that would be received
to sell an asset or paid to transfer a liability
in an orderly transaction between market
participants at the measurement date.
(ii) The preparation of financial statements
requires judgments, estimates and
assumptions that affect the reported
amount of assets and liabilities, disclosure
of contingent liabilities on the date of the
financial statements and the reported
amount of revenues and expenses during
the reporting period. Difference between the
actual results and estimates are recognized
in the period in which the results are known/
materialized.
2. Functional and Presentation Currency
These financial statements are presented in Indian
Rupees (INR), which is the Company’s functional
currency. All financial information presented in
INR has been rounded to the nearest lacs (up to
two decimals), except as stated otherwise.
3. CurrentandNon-currentclassification
The Company presents assets and liabilities in
the Balance Sheet based on current/non-current
classification.
An asset is current when it is:
• Expected to be realized or intended to sold
or consumed in normal operating cycle;
• Held primarily for the purpose of trading;
• Expected to be realized within twelve months
after the reporting period; or
• Cash or Cash equivalent unless restricted
from being exchanged or used to settle a
liability for at least twelve months after the
reporting period.
All other assets are classified as non-current.
A liability is current when:
• It is expected to be settled in normal operating
cycle;
• It is held primarily for the purpose of trading;
• It is due to be settled within twelve months
after the reporting period; or
• There is no unconditional right to defer
settlement of the liability for at least twelve
months after the reporting period.
All other liabilities are classified as Non-Current.
Deferred Tax Assets/Liabilities are classified as
Non-Current.
C. SignificantAccountingPolicies
A summary of the significant accounting policies
applied in the preparation of the financial statements
are as given below. These accounting policies have
been applied consistently to all periods presented in
the financial statements.
1. Property Plant & Equipment
1.1. Initial recognition and measurement
An item of property, plant and equipments
recognized as an asset if and only if it is
probable that future economic benefits
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
75
NOTES TO THE FINANCIAL STATEMENTS
associated with the item will flow to the
company and the cost of the item can be
measured reliably.
Items of Property, Plant and Equipment
are measured at cost less accumulated
depreciation/amortization and accumulated
impairment losses. Cost includes expenditure
that is directly attributable to bringing the
asset, inclusive of non-refundable taxes
& duties, to the location and condition
necessary for it to be capable of operating in
the manner intended by management.
When parts of an item of property, plant and
equipment have different useful lives, they
are recognized separately.
Items of spare parts, stand-by equipment
and servicing equipment which meet the
definition of Property, Plant and Equipment
are capitalized.
1.2. Subsequent costs
Subsequent expenditure is recognized as an
increase in the carrying amount of the asset
when it is probable that future economic
benefits deriving from the cost incurred will
flow to the enterprise and the cost of the item
can be measured reliably.
The cost of replacing part of an item of
property, plant and equipment is recognized
in the carrying amount of the item if it is
probable that the future economic benefits
embodied within the part will flow to the
Company and its cost can be measured
reliably. The carrying amount of the replaced
part is derecognized. The costs of the day-
to-day servicing of Property, Plant and
Equipment are recognized in Statement of
Profit or Loss A/c as incurred.
1.3. Derecognition
Property, Plant and Equipment are
derecognized when no future economic
benefits are expected from their use or upon
their disposal. Gains and losses on disposal of
an item of property, plant and equipment are
determined by comparing the proceeds from
disposal with the carrying amount of property,
plant and equipment, and are recognized in
the statement of profit and loss.
1.4. Depreciation
Assets are depreciated using straight line
method over the estimated useful life of the
asset as specified in Part “C” of Schedule II
of Companies Act, 2013 except for Plant &
Machinery (other than Laboratory Equipments,
Fire Fighting Equipments and Tools
&Equipments) whose estimated useful life is
taken as 13 years (Triple Shift) after retaining
residual life of 5% of original cost. Assets
residual values and useful lives are reviewed at
each financial year end considering the physical
condition of the assets.
Depreciation on additions to/deductions
from fixed assets during the year is charged
on pro-rata basis from/up to the date on
which the asset is available for use/disposed.
Where it is probable that future economic
benefits deriving from the cost incurred will
flow to the enterprise and the cost of the
item can be measured reliably, subsequent
expenditure on a PPE along-with its
unamortized depreciable amount is charged
off prospectively over the revised useful life
determined by technical assessment.
In circumstance, where a property is
abandoned, the cumulative capitalized costs
relating to the property are written off in the
same period.
2. Capital work-in-progress
The cost of self-constructed assets includes the
cost of materials & direct labour, any other costs
directly attributable to bringing the assets to
the location and condition necessary for it to be
capable of operating in the manner intended by
management.
Expenses directly attributable to construction of
property, plant and equipment incurred till they
are ready for their intended use are identified and
allocated on a systematic basis on the cost of
related assets.
3. Intangible assets and intangible assets under
development
3.1. Initial recognition and measurement
An intangible asset is recognized if and only
if it is probable that the expected future
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
76
NOTES TO THE FINANCIAL STATEMENTS
economic benefits that are attributable to the
asset will flow to the company and the cost of
the asset can be measured reliably.
Intangible assets that are acquired by the
Company, which have finite useful lives, are
recognized at cost. Subsequent measurement
is done at cost less accumulated amortization
and accumulated impairment losses. Cost
includes any directly attributable incidental
expenses necessary to make the assets ready
for its intended use.
Expenditure on development activities is
capitalized only if the expenditure can be
measured reliably, the product or process
is technically and commercially feasible,
future economic benefits are probable and
the Company intends to and has sufficient
resources to complete development and to
use or sell the asset.
Expenditure incurred which are eligible
for capitalization under intangible assets
are carried as intangible assets under
development till they are ready for their
intended use.
3.2. Subsequent costs
Subsequent expenditure is recognized as an
increase in the carrying amount of the asset
when it is probable that future economic
benefits deriving from the cost incurred will
flow to the enterprise and the cost of the item
can be measured reliably.
3.3. Derecognition
An intangible asset is derecognized when no
future economic benefits are expected from
their use or upon their disposal. Gains and
losses on disposal of an item of intangible
assets are determined by comparing the
proceeds from disposal with the carrying
amount of intangible assets and are recognized
in the statement of profit and loss.
3.4. Amortization
Intangible assets having definite life is
amortized on straight line method in their
useful lives. Useful life of computer software
is estimated at five years.
4. Borrowing Cost
Borrowing costs that are directly attributable
to the acquisition, construction, exploration,
development or erection of qualifying assets are
capitalized as part of cost of such asset until such
time the assets are substantially ready for their
intended use. Qualifying assets are assets which
take a substantial period of time to get ready
for their intended use or sale. Capitalization of
borrowing costs ceases when substantially all
the activities necessary to prepare the qualifying
assets for their intended uses are complete.
Borrowing costs consist of:
(a) interest expense calculated using the effective
interest method as described in Ind AS 109 –
‘Financial Instruments’,
(b) finance charges in respect of finance leases
recognized in accordance with Ind AS 17 –
‘Leases’,
(c) exchange differences arising from foreign
currency borrowings to the extent that they are
regarded as an adjustment to interest costs and,
(d) other costs that an entity incurs in connection
with the borrowing of funds. Income earned
on temporary investment of the borrowings
pending their expenditure on the qualifying
assets is deducted from the borrowing costs
eligible for capitalization.
All other borrowing costs are charged to revenue
as and when incurred.
5. Statement of Cash Flows
Cash flow statement has been prepared in
accordance with the Indirect method prescribed
in Ind AS 7 ‘Statement of Cash Flows’.
6. Inventories
Inventories are valued at the lower of cost and net
realizable value. Cost includes cost of purchase,
cost of conversion and other costs incurred in
bringing the inventories to their present location
and condition. Costs of purchased inventory
are determined after deducting rebates and
discounts. Net realizable value is the estimated
selling price in the ordinary course of business,
less estimated costs of completion and the
estimated costs necessary to make the sale.
Spare parts other than those capitalized as
Property, Plant and Equipment are carried as
inventory.
The diminution in the value of obsolete,
unserviceable and surplus stores & spares is
ascertained on review and provided for.
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
77
NOTES TO THE FINANCIAL STATEMENTS
7. Cash and Cash Equivalent
Cash and cash equivalent in the balance sheet
comprises cash at banks, cash on hand and short-
term deposits with an original maturity of three
months or less, which are subject to insignificant
risk of change in value.
8. Government Grants
Government grants that compensate the
company for the cost of asset are recognized
initially as deferred income when there is
reasonable assurance that they will be received
and the Company will comply with the conditions
associated with the grant and are recognized in
Statement of Profit & Loss A/c on a systematic
basis over the useful life of the related asset.
Grants that compensate the Company for
expenses incurred are recognized over the period
in which the related costs are incurred and are
deducted from the related expenses.
9. Provisions, Contingent Liabilities and Contingent
Assets
A provision is recognized if, as a result of a
past event, the Company has a present legal or
constructive obligation that can be estimated
reliably, and it is probable that an outflow of
economic benefits will be required to settle
the obligation. If the effect of the time value of
money is material, provisions are determined
by discounting the expected future cash flows
at a pre-tax rate that reflects current market
assessments of the time value of money and the
risks specific to the liability. When discounting
is used, the increase in the provision due to the
passage of time is recognized as a finance cost.
The amount recognized as a provision is the
best estimate of the consideration required to
settle the present obligation at reporting date,
taking into account the risks and uncertainties
surrounding the obligation.
When some or all of the economic benefits
required to settle a provision are expected to be
recovered from a third party, the receivable is
recognized as an asset if it is virtually certain that
reimbursement will be received and the amount
of the receivable can be measured reliably. The
expense relating to a provision is presented
in the statement of profit and loss net of any
reimbursement.
Contingent liabilities are possible obligations that
arise from past events and whose existence will
only be confirmed by the occurrence or non-
occurrence of one or more future events not
wholly within the control of the Company. Where
it is not probable that an outflow of economic
benefits will be required, or the amount cannot
be estimated reliably, the obligation is disclosed
as a contingent liability, unless the probability
of outflow of economic benefits is remote.
Contingent liabilities are disclosed on the basis
of judgment of the management/independent
experts. These are reviewed at each balance
sheet date and are adjusted to reflect the current
management estimate.
Contingent assets are possible assets that arise
from past events and whose existence will
be confirmed only by the occurrence or non-
occurrence of one or more uncertain future
events not wholly within the control of the
Company. Contingent assets are disclosed in the
financial statements when inflow of economic
benefits is probable on the basis of judgment
of management. These are assessed continually
to ensure that developments are appropriately
reflected in the financial statements.
10. Foreign currency transactions and translation
Transactions in foreign currencies are initially
recorded at the functional currency rates at the
date the transaction first qualifies for recognition.
Monetary assets and liabilities denominated in
foreign currencies are translated at the functional
currency spot rates of exchange at the reporting
date. Exchange differences arising on settlement
or translation of monetary items are recognized
in Statement of Profit and Loss A/c in the year in
which it arises.
Non-monetary items are measured in terms of
historical cost in a foreign currency are translated
using the exchange rate at the date of the
transaction.
11. Revenue Recognition
The Company derives revenues primarily from
business of textiles. Effective April 1, 2018, the
Company adopted Ind AS 115 “Revenue from
Contracts with Customers” using cumulative
catch-up transition method, applied to contracts
that were not completed as of April 1, 2018.
In accordance with the cumulative catch-up
transition method, the comparatives have not
been retrospectively adjusted. The following is
a summary of new and/or revised significant
accounting policies related to revenue
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
78
NOTES TO THE FINANCIAL STATEMENTS
recognition. Refer Note1“Significant Accounting
Policies,” in the Company’s 2018 Annual Report
for the policies in effect for revenue prior to April
1, 2018. The effect on adoption of Ind AS 115 was
insignificant.
Revenue is recognized upon transfer of control
of promised products or services to customers
in an amount that reflects the consideration we
expect to receive in exchange for those products
or services.
Ind AS 115 moves away from the “transfer of risk
and rewards” approach and introduces a new
“transfer of control” approach delivered through
the new five-step model described as follows:
1. Identify the contract with a customer.
2. Identify the separate performance obligations
in the contract.
3. Determine the transaction Price.
4. Allocate the transaction price to the separate
performance obligations.
5. Recognize revenue when (or as) each
performance obligation is satisfied.
At contract inception, an entity assesses the
goods or services promised in a contract with
a customer and identify each performance
obligation promised to be transferred to the
customer either:
(a) a good or service (or a bundle of goods or
services) that is distinct; or
(b) a series of distinct goods or services that are
substantiallythe same and that have the same
pattern of transfer to the customer.
The company classifies the right to consideration
in exchange for deliverables as either a receivable
or as a contract asset. A receivable is a right to
consideration that is unconditional upon passage
of time .Revenues in excess of billings is recorded
as contract asset and is classified as a financial
asset for these cases a right to consideration is
unconditional upon passage of time. This would
result in the timing of revenue recognition being
different from the time of billing the customers.
Company classifies amount received as advance
from customers against sales as contract liability.
Trade receivables and unbilled revenues are
presented net of impairment in the Balance Sheet.
11.1 Sale of Goods
Revenue from the sale of goods is recognised
upon transfer of control of the goods have
passed to the buyer, which generally coincides
with dispatch. Revenue from export sales are
recognised on shipment basis. Revenue from
the sale of goods is measured at an amount
that reflects the consideration we expect to
receive in exchange for those products(i.e.
the transaction price). The Company presents
revenues net of indirect taxes, returns and
allowances, trade discounts and volume
rebates in its statement of Profit and loss.
Inter-divisional sales comprising of sale of
power for captive consumption is reduced
from gross turnover in arriving net turnover.
11.2 Rendering of services
Revenue from job work services is recognised
based on the services rendered in accordance
with the terms of contracts.
11.3OtherExportBenefit
Export benefits are accounted for in the year
of export at net market realizable value.
11.4 Other Income
Revenue from transactions or events that do
not arise from a contract with a customer
is not in the scope of Ind AS 115 and should
continue to be recognized in accordance with
the other standards. Such Income includes
Interest and Dividend income which are dealt
with in Ind AS 109 and Rental income to be
accounted as per Ind AS 17.
11.5 Interest Income
For all financial instruments measured at
amortized cost and interest-bearing financial
assets classified as fair value through other
comprehensive income, interest income is
recorded using the effective interest rate
(EIR). The EIR is the rate that exactly discounts
the estimated future cash receipts over the
expected life of the financial instrument or
a shorter period, where appropriate, to the
net carrying amount of the financial asset.
When calculating the effective interest rate,
the Company estimates the expected cash
flows by considering all the contractual terms
of the financial instrument (for example, pre
payment, extension, call and similar options)
but does not consider the expected credit
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
79
NOTES TO THE FINANCIAL STATEMENTS
losses. Interest income is included in other
income in the statement of profit or loss.
11.6 Dividend
Dividend Income is recognized when the
company’s right to receive is established
which generally occurs when the shareholders
approve the dividend.
11.7 Income other than Interest and Dividend
Other income is recognized in the statement
of profit and loss when increase in future
economic benefits related to an increase in
an asset or a decrease of a liability has arisen
that can be measured reliably.
12. EmployeeBenefits
12.1.ShortTermBenefit
Short-term employee benefit obligations are
measured on an undiscounted basis and are
booked as an expense as the related service
is provided.
A liability is recognized for the amount
expected to be paid under performance
related pay if the Company has a present
legal or constructive obligation to pay this
amount as a result of past service provided
by the employee and the obligation can be
estimated reliably.
12.2Post-Employmentbenefits
Employee benefit that are payable after
the completion of employment are Post-
Employment Benefit (other than termination
benefit). These are of two types:
12.2.1Definedcontributionplans
Defined contribution plans are those
plans in which an entity pays fixed
contribution into separate entities and will
have no legal or constructive obligation
to pay further amounts. Provident Fund
and Family Pension Funds are Defined
Contribution Plans in which company
pays a fixed contribution and will have no
further obligation.
12.2.2Definedbenefitplans
A defined benefit plan is a post-
employment benefit plan other than a
defined contribution plan.
Company pays Gratuity as per provisions
of the Gratuity Act, 1972. The Company’s
net obligation in respect of defined
benefit plans is calculated separately
for each plan by estimating the amount
of future benefit that employees have
earned in return for their service in the
current and prior periods; that benefit
is discounted to determine its present
value. Any unrecognized past service
costs and the fair value of any plan
assets are deducted. The discount rate
is based on the prevailing market yields
of Indian government securities as at the
reporting date that have maturity dates
approximating the terms of the Company’s
obligations and that are denominated in
the same currency in which the benefits
are expected to be paid.
The calculation is performed annually by
a qualified actuary using the projected
unit credit method. When the calculation
results in a liability to the company, the
present value of liability is recognized
as provision for employee benefit. Any
actuarial gains or losses inrespect of
gratuity are recognized in OCI in the
period in which they arise.
12.3Otherlong-termemployeebenefits
Benefits under the Company’s leave
encashment scheme constitute other long-
term employee benefits. The Company’s net
obligation in respect of leave encashment is
the amount of future benefit that employees
have earned in return for their service in the
current and prior periods; that benefit is
discounted to determine its present value,
and the fair value of any related assets is
deducted. The discount rate is based on the
prevailing market yields of Indian government
securities as at the reporting date that have
maturity dates approximating the terms of
the Company’s obligations. The calculation
is performed using the projected unit credit
method. Any actuarial gains or losses are
recognized in profit or loss in the period in
which they arise.
13. Income Taxes
Income tax expense comprises current and
deferred tax. Current tax expense is recognized
in Statement of Profit and Loss A/c except to the
extent that it relates to items recognized directly
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
80
in other comprehensive income or equity, in which
it is recognized in OCI or equity.
Current tax is the expected tax payable on the
taxable income for the year, using tax rates enacted
or substantively enacted and as applicable at the
reporting date, and any adjustment to tax payable
in respect of previous years. Current income taxes
are recognized under ‘Income tax payable’ net of
payments on account, or under ‘Tax receivables’
where there is a debit balance.
Deferred tax is recognized using the balance sheet
method, providing for temporary differences
between the carrying amounts of assets and
liabilities for financial reporting purposes and the
amounts used for taxation purposes. Deferred tax
is measured at the tax rates that are expected to
be applied to temporary differences when they
reverse, based on the laws that have been enacted
or substantively enacted by the reporting date.
Deferred tax assets and liabilities are offset if there
is a legally enforceable right to offset current tax
liabilities and assets, and they relate to income
taxes levied by the same tax authority on the same
taxable entity, or on different tax entities, but they
intend to settle current tax liabilities and assets on
a net basis or their tax assets and liabilities will be
realized simultaneously.
Deferred tax is recognized in Statement of Profit
and Loss A/c except to the extent that it relates
to items recognized directly in OCI or equity, in
which case it is recognized in OCI or equity.
A deferred tax asset is recognized to the extent
that it is probable that future taxable profits
will be available against which the temporary
difference can be utilized. Deferred tax assets are
reviewed at each reporting date and are reduced
to the extent that it is no longer probable that
the related tax benefit will be realized. Minimum
Alternate Tax credit is recognized as deferred
tax asset only when and to the extent there is
convincing evidence that the Company will pay
normal income tax during the specified period.
Such asset is reviewed at each Balance Sheet
date and the carrying amount of the MAT credit
asset is written down to the extent there is no
longer a convincing evidence to the effect that
the Company will pay normal income tax during
the specified period.
NOTES TO THE FINANCIAL STATEMENTS
Additional income taxes that arise from the
distribution of dividends are recognized at the
same time that the liability to pay the related
dividend is recognized.
14. Leases:
14.1 Recognition:
At inception of an arrangement, the Company
determines whether such an arrangement is
or contains a lease. A specific asset is subject
of a lease if fulfillment of the arrangement
is dependent on the use of that specified
asset. An arrangement conveys the right to
use the asset if the arrangement conveys
to the customer the right to control the use
of the underlying asset. Arrangements that
do not take the legal form of a lease but
convey rights to customers/suppliers to use
an asset in return for a payment or a series
of payments are identified as either finance
leases or operating leases.
14.2 Accounting for
14.2.1OperatingLeases
Leases in which a significant portion of
the risks and rewards of ownership are
not transferred to the Company as lessee
are classified as operating lease. Payments
made under operating leases are recognized
as an expense over the lease term.
14.2.2FinanceLease
Leases of Property, Plant and Equipment
where the Company, as lessee has
substantially all risks and rewards of
ownership are classified as finance
lease. On initial recognition, assets held
under finance leases are recorded as
Property, Plant and Equipment and
the related liability is recognized under
borrowings. At inception of the lease,
finance leases are recorded at amounts
equal to the fair value of the leased
asset or, if lower, the present value of
the minimum lease payments. Minimum
lease payments made under finance
leases are apportioned between the
finance expense and the reduction of the
outstanding liability.
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
81
NOTES TO THE FINANCIAL STATEMENTS
15. Impairment of Non-Financial Assets
The carrying amounts of the Company’s non-
financial assets are reviewed at each reporting
date to determine whether there is any indication
of impairment considering the provisions of
Ind AS 36 ‘Impairment of Assets’. If any such
indication exists, then the asset’s recoverable
amount (higher of its fair value less costs to
disposal or its value in use) is estimated.
An impairment loss is recognized if the carrying
amount of an asset or its Cash Generating Unit
(CGU) exceeds its estimated recoverable amount.
Impairment losses are recognized in profit or loss.
Impairment losses recognized in prior periods are
assessed at each reporting date for any indications
that the loss has decreased or no longer exists.
An impairment loss is reversed if there has been
a change in the estimates used to determine the
recoverable amount which is only to the extent
that the asset’s carrying amount does not exceed
the carrying amount that would have been
determined, net of depreciation or amortization, if
no impairment loss had been recognized.
16. Dividends
Dividends and Interim dividends payable to
a Company’s shareholders are recognized as
changes in equity in the period in which they are
approved by the shareholders’ meeting and the
Board of Directors respectively.
17. Material Prior Period Errors
Material prior period errors are corrected
retrospectively by restating the comparative
amounts for the prior periods presented in which
the error occurred. If the error occurred before
the earliest prior period presented, the opening
balances of assets, liabilities and equity for the
earliest prior period presented, are restated.
18. Earnings Per Share
Basic earnings per equity share is computed by
dividing the net profit or loss attributable to equity
shareholders of the Company by the weighted
average number of equity shares outstanding
during the financial year.
Diluted earnings per equity share is computed by
dividing the net profit or loss attributable to equity
shareholders of the Company by the weighted
average number of equity shares considered for
deriving basic earnings per equity share and also
the weighted average number of equity shares
that could have been issued upon conversion of
all dilutive potential equity shares.
19. Financial instruments
A financial instrument is any contract that gives
rise to a financial asset of one entity and a financial
liability or equity instrument of another entity.
a. Financial assets
Initialrecognitionandmeasurement
All financial assets are recognized initially
at fair value plus or minus, in the case of
financial assets not recorded at fair value
through profit or loss, transaction costs that
are attributable to the acquisition or issue of
the financial asset.
Impairmentoffinancialassets
In accordance with Ind-AS 109, the Company
applies expected credit loss (ECL) model for
measurement and recognition of impairment
loss on the financial assets and credit risk
exposure.
For recognition of impairment loss on
financial assets and risk exposure, the
Company determines that whether there has
been a significant increase in the credit risk
since initial recognition. If credit risk has not
increased significantly, 12-month ECL is used
to provide for impairment loss. However, if
credit risk has increased significantly, lifetime
ECL is used. If, in a subsequent period, the
credit quality of the instrument improves then
the entity reverts to recognizing impairment
loss allowance based on 12-month ECL.
In respect of Trade receivables or any
financial asset that result from transactions
that are within the scope of Ind AS 115,
company follows ‘simplified approach’ for
recognition of impairment loss allowance
within the scope of Ind AS 115, if they do not
contain a significant financing component. It
recognizes impairment loss allowance based
on lifetime ECLs at each reporting date, right
from its initial recognition.
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
82
NOTES TO THE FINANCIAL STATEMENTS
b. Financial liabilities
Initialrecognitionandmeasurement
All financial liabilities are recognized at fair
value and in case of loans, net of directly
attributable transaction cost. Fees of recurring
nature are directly recognized in the Statement
of Profit and Loss as finance cost.
Subsequentmeasurement
Financial liabilities are carried at amortized
cost using the effective interest method.
Amortized cost is calculated by taking
into account any discount or premium on
acquisition and any material transaction that
are any integral part of the EIR. For trade and
other payables maturing within one year from
the balance sheet date, the carrying amounts
approximate the fair value of the instrument.
Derecognition
A financial liability is derecognized when the
obligation under the liability is discharged
or cancelled or expired. When an existing
financial liability is replaced by another from
the same lender on substantially different
terms, or the terms of an existing liability are
substantially modified, such an exchange or
modification is treated as the derecognition
of the original liability and the recognition of
a new liability. The difference in the respective
carrying amounts is recognized in the
Statement of Profit and Loss A/c.
c. Derivativefinancialinstruments
The Company uses forwards to mitigate the
risk of changes in interest rates, exchange
rates and commodity prices. Such derivative
financial instruments are initially recognized
at fair value on the date on which a derivative
contract is entered into and are also
subsequently measured at fair value on the
reporting date. Derivatives are carried as
financial assets when the fair value is positive
and as financial liabilities when the fair value
is negative. Any gains or losses arising from
changes in the fair value of derivatives are
taken to cash flow hedge reserve through
Statement of Other Comprehensive Income.
These are accounted for as follows:
a) Cashflowhedge
When derivative is designated as a cash
flow hedging instrument, the effective
portion of changes in the fair value of
the derivative is recognized in the cash
flow hedging reserve being part of other
comprehensive income. Any ineffective
portion of changes in the fair value of the
derivative is recognized immediately in
the Statement of Profit and Loss. If the
hedging instrument expires or is sold,
terminated or exercised, the cumulative
gain or loss previously recognized in the
cash flow hedging reserve is transferred
to the Statement of Profit and Loss
upon the occurrence of the underlying
transaction. If the forecasted transaction
is no longer expected to occur, then
the amount accumulated in cash flow
hedging reserve is reclassified in the
Statement of Profit and Loss.
b) FairValueHedge
Changes in the fair value of hedging
instruments and hedged items that
are designated and qualify as fair value
hedges are recorded in the Statement
of Profit and Loss. If the hedging
relationship no longer meets the criteria
for hedge accounting, the adjustment to
the carrying amount of a hedged item
for which the effective interest method is
used is amortized to Statement of Profit
and Loss over the period of maturity.
20. CSR Expenditure
Amount spent on CSR activities during the year is
charged to Statement of Profit & Loss, if the same
is of revenue nature. If the expenditure is of such
nature, which may give rise to a capital asset, the
same is recognized in the Balance Sheet as “CSR
Assets” under respective Fixed Assets.
D. Major Estimates made in preparing Financial
Statements:
1. Useful life of property, plant and equipment and
intangible assets
The estimated useful life of property, plant and
equipment is based on a number of factors
including the effects of obsolescence, demand,
competition and other economic factors (such
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
83
NOTES TO THE FINANCIAL STATEMENTS
as the stability of the industry and known
technological advances) and the level of
maintenance expenditures required to obtain the
expected future cash flows from the asset.
Useful life of the assets other than Plant and
machinery (except Laboratory Equipments, Fire
Fighting Equipments and Tools & Equipments) are
in accordance with Schedule II of the Companies
Act, 2013.
The Company reviews at the end of each
reporting date the useful life of property, plant
and equipment, and are adjusted prospectively, if
appropriate.
Intangible assets are being amortized on straight
line basis over the period of five years.
2. Post-employmentbenefitplans
Employee benefit obligations are measured
on the basis of actuarial assumptions which
include mortality and withdrawal rates as well as
assumptions concerning future developments in
discount rates, the rate of salary increases and
the inflation rate. The Company considers that
the assumptions used to measure its obligations
are appropriate and documented. However,
any changes in these assumptions may have a
material impact on the resulting calculations.
3. Provisions and contingencies
The assessments undertaken in recognizing
provisions and contingencies have been made in
accordance with Ind AS 37, ‘Provisions, Contingent
Liabilities and Contingent Assets’. The evaluation of
the likelihood of the contingent events requires best
judgment by management regarding the probability
of exposure to potential loss. In case of change in
the circumstances the following unforeseeable
developments, the likelihood could alter.
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
84
NO
TE
S T
O T
HE
FIN
AN
CIA
L S
TA
TE
ME
NT
SN
ote
2 : P
rop
ert
y, P
lan
t an
d E
qu
ipm
en
t
As
at
31s
t M
arc
h 2
019
(H In
Lacs)
Part
icu
lars
Gro
ss C
arr
yin
g A
mo
un
tD
ep
recia
tio
n/A
mo
rtis
ati
on
Ne
t C
arr
yin
g A
mo
un
t
As
at
1st
Ap
ril
20
18A
dd
itio
nD
ed
ucti
on
As
at
31s
t M
arc
h 2
019
As
at
1st
Ap
ril
20
18F
or
the
Y
ear
De
du
cti
on
As
at
31s
t M
arc
h 2
019
As
at
31s
t M
arc
h 2
019
As
at
1st
Ap
ril
20
18
Tan
gib
le A
sse
ts
Fre
e H
old
Lan
d774
.40
103
.53
-
877.
93
-
-
-
-
877.
93
774
.40
Lease
Ho
ld L
an
d
135
.06
-
-
135
.06
2.0
51.3
1 -
3
.36
131.70
133
.01
Bu
ildin
gs
139
13.7
417
6.4
3 -
14
09
0.17
1017
.68
58
4.6
5 -
16
02.3
312
48
7.8
412
89
6.0
6
Pla
nt
& M
ach
inery
49
96
0.5
14
64
.48
78
.08
50
34
6.9
18
121.27
46
39
.79
28
.45
1273
2.6
1376
14.3
04
183
9.2
4
Ele
ctr
ic in
stalla
tio
n9
91.25
27.
65
-
1018
.90
38
4.8
110
4.2
6 -
4
89
.07
529
.83
60
6.4
4
Fu
rnit
ure
& F
ixtu
res
36
9.6
74
0.3
3 -
4
10.0
021.9
837.
49
-
59
.47
35
0.5
33
47.
69
Offi
ce E
qu
ipm
en
ts17
7.11
11.5
10
.36
188
.26
34
.82
37.
61
0.2
972.14
116
.1214
2.2
9
Veh
icle
s26
4.7
56
5.2
36
.35
323
.63
66
.26
44
.113
.01
107.
36
216
.27
198
.49
To
tal
66
58
6.4
98
89
.16
84
.79
67
39
0.8
69
64
8.8
75
44
9.2
23
1.7
515
06
6.3
45
23
24
.52
56
93
7.6
2
Pre
vio
us
Ye
ar
65
38
1.4
512
43
.57
38
.53
66
58
6.4
94
07
9.5
35
60
5.7
93
6.4
59
64
8.8
75
69
37
.62
613
01.
92
(H In
Lacs)
Part
icu
lars
Gro
ss C
arr
yin
g A
mo
un
tD
ep
recia
tio
n/A
mo
rtis
ati
on
Ne
t C
arr
yin
g A
mo
un
t
As
at
1st
Ap
ril
20
18A
dd
itio
nD
ed
ucti
on
As
at
31s
t M
arc
h 2
019
As
at
1st
Ap
ril
20
18F
or
the
Y
ear
De
du
cti
on
As
at
31s
t M
arc
h 2
019
As
at
31s
t M
arc
h 2
019
As
at
1st
Ap
ril
20
18
Lease
Ho
ld L
an
d
135
.06
-
-
13
5.0
6
2.0
5
1.3
1 -
3
.36
1
31.70
1
33
.01
Bu
ildin
g -
1
62.18
-
1
62.18
-
1
.28
-
1
.28
1
60
.90
-
Ele
ctr
ic In
stalla
tio
n -
2
5.4
7
-
25
.47
-
1.18
-
1.18
2
4.2
9
-
Fu
rnit
ure
& F
ixtu
res
-
29
.45
-
2
9.4
5
-
1.74
-
1.7
4
27.
71
-
To
tal
135
.06
217
.10
0.0
03
52
.16
2.0
55
.51
0.0
07
.56
34
4.6
013
3.0
1
2.1
All
Pro
pert
y, P
lan
t an
d E
qu
ipm
en
ts m
en
tio
ned
ab
ove (
excep
t P
PE
un
der
CS
R)
havin
g n
et
blo
ck o
f H 5
1979
.92 L
acs
(Pre
vio
us
Year
- H 5
6,8
04
.61
Lacs)
are
held
as
secu
rity
tow
ard
s B
orr
ow
ing
s as
specifi
ed
in
No
te 1
3
2.2
De
tail
s o
f P
rop
ert
y, P
lan
t an
d E
qu
ipm
en
t u
nd
er
CS
R i
nclu
de
d i
n a
bo
ve
are
as
foll
ow
s:
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
85
NO
TE
S T
O T
HE
FIN
AN
CIA
L S
TA
TE
ME
NT
SN
ote
2 : P
rop
ert
y, P
lan
t an
d E
qu
ipm
en
t (C
on
td..)
Note3:CapitalWorkInProgress
2.3
In
form
ati
on
re
gard
ing
His
tori
cal
co
st o
f P
rop
ert
y, P
lan
t an
d E
qu
ipm
en
t b
ase
d o
n t
he
pre
vio
us
GA
AP
pri
or
to d
ate
of
tran
siti
on
to
In
d A
S i
s as
foll
ow
s:
(H In
Lacs)
Part
icu
lars
Fre
e H
old
L
an
dL
ease
H
old
Lan
dB
uil
din
gs
Pla
nt
&
Mach
ine
ryE
lectr
ic
Inst
all
ati
on
Fu
rnit
ure
&
Fix
ture
sOffice
Eq
uip
me
nts
Ve
hic
les
To
tal
GrossBlockason1stApril2018
774
.40
135
.06
1611
6.4
670
617
.32
223
5.5
14
15.12
271.6
33
34
.169
08
99
.66
Ad
dit
ion
/Ad
just
men
t d
uri
ng
th
e y
ear
20
18-1
910
3.5
3 -
17
6.4
328
0.6
627.
65
40
.33
10.9
65
5.13
69
4.6
9
To
tal
His
tori
cal
Co
st a
s o
n 3
1st
Marc
h 2
019
87
7.9
313
5.0
616
29
2.8
97
08
97
.98
22
63
.16
45
5.4
52
82
.59
38
9.2
99
159
4.3
5
As
at
31s
t M
arc
h 2
019
(H In
Lacs)
Part
icu
lars
As
at
1st
Ap
ril
20
18
Ad
dit
ion
De
du
cti
on
/
Ad
just
em
en
ts
Cap
itali
sed
As
at
31s
t
Marc
h 2
019
Exis
tin
g P
roje
ct
Pla
nt
& M
ach
inery
-
122.5
2 -
-
12
2.5
2
CS
R B
uild
ing
1
23
.18
38
.99
-
162.17
-
Ne
w P
roje
ct
Be
gu
nB
uild
ing
18
7.4
2
11,721.1
1 -
-
1
1,9
08
.53
Pla
nt
& M
ach
inery
24
.74
3
0,3
75
.84
-
-
3
0,4
00
.58
Ele
ctr
ic In
stalla
tio
n
29
.79
1
,526
.46
-
-
1
,55
6.2
5
Offi
ce E
qu
ipm
en
t -
5
7.9
7
-
-
57.
97
Fu
rnit
ure
& F
ixtu
res
0.2
0
318
.98
-
-
3
19.18
Inta
ng
ible
Ass
ets
-
78
.81
-
-
78
.81
Pre
Op
era
tive E
xp
-
Fin
an
ce C
harg
es
-
274
.02
-
-
274
.02
-
Ele
ctr
icit
y &
Wate
r E
xp
-
92.3
5
-
-
92.3
5
-
Inte
rest
Co
st -
8
62.8
5
-
-
86
2.8
5
-
Leg
al &
Pro
fess
ion
al E
xp
5.2
3
29
9.6
2
-
-
30
4.8
5
-
Em
plo
yee B
en
efi
t E
xp
19
.56
3
36
.55
-
-
3
56
.11
-
Oth
er
Ad
min
istr
ati
ve E
xp
34
.50
1
05
.27
-
-
139
.77
Excess
of
Exp
en
dit
ure
over
Inco
me d
uri
ng
Tri
al P
eri
od
as
per
No
te 3
.1 -
3
45
.85
-
-
3
45
.85
To
tal
42
4.6
24
65
57
.19
0.0
016
2.1
74
68
19.6
4
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
86
NO
TE
S T
O T
HE
FIN
AN
CIA
L S
TA
TE
ME
NT
SNote3:CapitalWorkInProgress(Contd..)
No
te 4
: O
the
r In
tan
gib
le A
sse
ts
No
te 3
.1 T
rial
Pe
rio
d I
nco
me
& E
xp
en
dit
ure
(H In
Lacs)
Part
icu
lars
Fo
r th
e
ye
ar
en
de
d
31.
03
.20
19
Exp
en
dit
ure
Co
st o
f M
ate
rials
Co
nsu
med
54
94
.11
Ch
an
ges
in Inven
tori
es
of
Fin
ish
ed
Go
od
s,
Wo
rk-i
n-p
rog
ress
an
d S
tock-i
n-T
rad
e
(113
4.9
1)
Em
plo
yee B
en
efi
ts E
xp
en
se5
02.0
8
Fin
an
ce C
ost
16.6
3
Oth
er
Exp
en
ses
-
Po
wer
Exp
.8
47.
72
-
Sto
res
& S
pare
s C
on
sum
pti
on
34
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CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
87
NOTES TO THE FINANCIAL STATEMENTS
Note 4 : Other Intangible Assets (Contd..)
Note 5 : Other Non Current Assets
Note 6 : Inventories
6.1 Inventory has been valued as per the Accounting Policy
6.2 Raw Material consist of:
4.2 Information regarding Historical cost of Intangible Assets based on the previous GAAP prior to date of transition
to Ind AS is as follows:
(H In Lacs)
Particulars Computer
Software
GrossBlockason1stApril2018 71.45
Addition/Adjustment during the year 2018-19 3.14
Total Historical Cost as on 31st March 2019 74.59
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Security Deposits 868.03 403.33
Income Tax Refundable 2.22 2.22
Deferred Transaction Cost 50.41 65.99
Capital Advances 1,420.36 338.49
Total 2341.02 810.03
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Cotton 16227.84 16700.51
Polyster 66.86 -
Yarn 239.69 55.56
Total 16534.39 16756.07
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Raw Material 16534.39 16756.07
Work-In-Process 1869.98 1062.58
Finished Goods 3021.74 1963.72
Stores and Spares 761.63 576.39
Fuel 594.80 190.11
Total 22782.54 20548.87
Financial Assets
Current Assets
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
88
NOTES TO THE FINANCIAL STATEMENTS
Note 6 : Inventories (Contd..)
Note 7 : Current Financial Assets - Trade Receivables
Note 8 : Current Financial Assets - Cash and Cash Equivalents
6.3 Finished Goods consist of:
Note 7.1 Ageing and other information has been depicted in Note no. 36
Note8A:CurrentFinancialAssets-BankBalancesotherthanCashandCashEquivalents
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Yarn 2178.34 1610.88
Grey Fabric 650.13 215.41
Saleable Waste 193.27 137.43
Total 3021.74 1963.72
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Secured
Considered Good - -
Unsecured
Considered Good 12072.54 8781.01
Credit Impaired - 58.08
Less : - Impairment Allowance - (29.04)
Net 0.00 29.04Total 12072.54 8810.05
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Cash in Hand 1.96 2.67
Balance with Banks in :
Current Accounts 273.05 7.34
Total 275.01 10.01
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Unclaimed Dividend Accounts 28.02 19.73
Total 28.02 19.73
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
89
NOTES TO THE FINANCIAL STATEMENTS
Note 9 : Other Current Financial Assets
Note 10 : Other Current Assets
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Derivative Assets (Net) 223.46 -
Advances to Employees 34.58 38.54
Total 258.04 38.54
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Advances to Suppliers 464.71 1545.60
Other Advances 109.92 82.62
Amount Receivable under TUFS /RIPS 1185.63 612.72
VAT & GST Credit Receivables 3401.02 1662.22
GST Refundable 1133.88 882.48
Other Receivables* 400.67 431.40
Total 6695.83 5217.04
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Authorised :6,00,00,000 (Previous Year : 6,00,00,000) 6000.00 6000.00
Equity Shares of H 10/- Each
Total 6000.00 6000.00Issued, Subscribed & Fully Paid up :5,62,20,000 (Previous Year : 5,55,51,710 ) 5622.00 5555.17
Equity Shares of H 10/- Each fully paid up
ranking pari passu
Total 5622.00 5555.17
* Other receivable includes amount of Rebates, Export Incentive and Duty drawback etc.
Equity & Liabilities
Equity
Note 11 : Share Capital
a. Details of Shareholders holding more than 5% Shares are as under :
Name of Shareholers No. of Shares
(% of Holding)
No. of Shares
(% of Holding)
Redial Trading & Investment Pvt. Ltd. 17728000 (31.53%) 16755000 (30.16%)
Ratan Lal Nolkha 6120000 (10.89%) 5716000 (10.29%)
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
90
NOTES TO THE FINANCIAL STATEMENTS
Note 11 : Share Capital (Contd..)
Note 12 : Other Equity
Note 12.1 : Particular of Other Equity
b. Reconciliation of the number of Shares outstanding is set out below :
Name of Shareholers No. of Shares No. of Shares
Equity Shares at the beginning of the year 55551710 45833945
Add : Shares issued during the year 668290 9717765
Equity Shares at the end of the year 56220000 55551710
c. The company has not issued, any Shares pursuant to contract without payment being received in Cash, Bonus
Shares and has not bought back any shares.
d. Terms and Rights attached to Equity Shares:
The company has only one class of Equity Shares having a par value of H 10/- per share. The holders of the equity
shares are entitled to dividends as declared from time to time and are entitled to voting rights proportionate to their
share holding at the meetings of shareholders.
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Capital Redemption Reserve 150.00 150.00
Securities Premium 13727.12 12988.65
General Reserve 5000.00 4000.00
Other Reserve - Cash Hedge Reserve 145.28 (16.47)
Retained Earning 23609.07 19005.80
Total 42631.47 36127.98
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
a. Capital Redemption Reserve Opening Balance 150.00 150.00
Additions during the year - -
Deductions during the year - -
Net Balance 150.00 150.00b. Securities Premium Opening Balance 12988.65 2766.73
Additions during the year 738.47 10221.92
Deductions during the year - -
Net Balance 13727.12 12988.65c. General Reserve Opening Balance 4000.00 3000.00
Additions during the year 1000.00 1000.00
Deductions during the year - -
Net Balance 5000.00 4000.00d. Other Reserve - Cash Hedge Reserve Opening Balance (16.47) 150.90
Additions during the period 161.75 (167.37)
Net Balance 145.28 (16.47)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
91
NOTES TO THE FINANCIAL STATEMENTS
Note 12 : Other Equity (Contd..)
Note 13 : Non Current Financial Liabilities - Borrowings
13.1 Security
Note 12.1 : Particular of Other Equity (Contd..)
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
(A)TermLoansfromBanks Term Loans from Banks 67501.76 36157.30
Less: taken to other Current Liabilities being Current Maturities 5628.25 5109.05
Total (A) 61873.51 31048.25(B)VehicleLoansFromBanks Vehicle Loans From Banks 2.35 8.29
Less: taken to other Current Liabilities being Current Maturities 2.35 6.40
Total (B) - 1.89 Total (A+B) 61873.51 31050.14
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
e. SurplusinProfit&LossAccount Opening Balance 19005.80 15777.53
Add: Profit for the year 6410.69 5238.59
Less : Allocation / Appropriation
Proposed Dividend 674.64 550.01
Tax on Proposed Dividend 138.67 111.97
Transfer to General Reserve 1,000.00 1000.00
Equity Issue Expenses - 388.20
Actuarial loss/(gain) (5.89) (39.86)
Sub Total 1807.42 2010.32 Net Balance 23609.07 19005.80 Total (a to e) 42631.47 36127.98
(a) Term Loans of H 67501.76 Lacs (PY H 35909.30 Lacs) are secured by way of first charge on all immovable and
movable Property, Plant & Equipments (both present and future) and second charge on current assets. The term
loan of H Nil (PY H 248.00 Lacs) are secured by way of IIIrd charge on all immovable and movable Property, Plant
and Equipment and current assets of the company. The term loans are also secured by personal guarantee of three
executive directors
(b) Vehicle Loans are secured by hypothecation of the specific vehicle
13.2 Terms of Repayment
(a) Term loans of H 48.25 Lacs is repayable in 3 equal quarterly instalments upto December 2019, H 11650.00 lacs in 16
variable quarterly instalments upto March 2023, H 19350.00 lacs in 23 variable quarterly instalments upto December
2024. For fresh term loan of H 47500 Lacs sanctioned for expansion project and disbursed partly (outstanding
as on 31st March 2019 H 36453.51 Lacs), the repayment shall start from September 2020 in 28 quarterly variable
instalments and ended upto June 2027.
(b) Vehicle loan of H 2.35 Lacs is repayable in 5 variable monthly instalments upto August 2019
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
92
NOTES TO THE FINANCIAL STATEMENTS
Note 14 : Non Current Liabilities - Provisions
Note 15 : Deferred Tax Liability
Note 17 : Current Financial Liabilities - Trade Payable
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Provision for Employee Benefits 1161.69 898.28
Total 1161.69 898.28
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Working Capital Loan from Banks (Secured) 18543.36 8751.55
Total 18543.36 8751.55
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
A. Deferred Tax Liability - Depreciation 6525.43 6599.83
- Deferred Transaction Cost 17.61 22.84
6543.04 6622.67B. Deferred Tax Assets - Employee Benefits & Other Expenses 499.21 406.65
499.21 406.65 Net Liability 6043.83 6216.02 Less : MAT Credit Entitlement 3130.83 4530.00
Deferred Tax related to OCI 78.17 (8.71)
C. Deferred Tax Liability (Net) 2991.17 1677.31
Note 15.1 Further information has been disclosed in Note No. 30
Note 16 : Current Financial Liabilities - Borrowings
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
For Goods Purchased
Due to Micro & Small Enterprises 101.37 -
Due to Others 932.13 509.91
For Services & Others 2510.02 2046.69
Total 3543.52 2556.60
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
93
NOTES TO THE FINANCIAL STATEMENTS
Note 17 : Current Financial Liabilities - Trade Payable (Contd..)
Note 18 : Other Current Financial Liability
Note 19 : Other Current Liabilities
Note 17.1 : Disclosure related to Micro, Small & Medium Enterprises
A. Trade Payables include Principal amount H 101.37 Lacs (Previous Year H Nil) and Interest amount H Nil (Previous Year H
Nil) due to Micro, Small & Medium Enterprises as at 31st March 2019. The figures have been disclosed on the basis of
informations received from suppliers who have registered themselves under the Micro, Small and Medium Enterprises
Development Act, 2006 (MSMED Act, 2006) and/or based on the information available with the company. Further,
no interest during the year has been paid or payable under the provisions of the MSMED Act, 2006.
B. No Interest has been paid under section 16 of the Micro, Small and Medium Enterprises Development Act, 2006
(27 of 2006)., along with the amount of the payment made to the supplier beyond the appointed day during each
accounting year.
C. No Interest due and payable for the period of delay in making payment (which has been paid but beyond the
appointed day during the year) but without adding the interest specified under the Micro, Small and Medium
Enterprises Development Act, 2006
D. No Interest accrued and remaining unpaid at the end of each accountig year
E. No further interest remaining due and payable even in the succeeding years, until such date when the interest dues
above are actually paid to the small enterprise, for the purpose of disalowance of a deductable expenditure under
section 23 of the Micro, Small and Medium Enterprises Development Act, 2016
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Derivative Liability (Net) - 25.18
Current Maturities of Long Term Debt 5630.60 5115.45
Interest accrued but not due on Borrowings - 1.16
Unclaimed Dividend 28.02 19.73
For Capital Goods
Due to Micro & Small Enterprises 16.97 -
Due to Others 406.75 88.67
Security Deposit 24.68 11.49
Other Payable 493.02 579.96
Total 6600.04 5841.64
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Advances From Customers 53.19 65.29
Statutory Dues 160.21 123.10
Security Deposit 56.38 44.68
Total 269.78 233.07
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
94
NOTES TO THE FINANCIAL STATEMENTS
Note 20 : Current Liabilities - Provisions
Note 21 : Current Tax Liabilities
Note 22 : Revenue from operations
Note 23 : Other Income
Note 24: Cost of Material Consumed
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Provision for Employee Benefits 114.86 96.46
Total 114.86 96.46
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Provision for Tax (Net) 276.89 70.96
Total 276.89 70.96
(H In Lacs)
Particulars For the year
ended
31st March 2019
For the year
ended
31st March2018
Revenue from Contract with Customers Sale of Products Yarn 97269.70 86573.85
Fabrics 17565.28 17609.05
Others 7992.44 8546.38
Sale of Services 5.60 1.14
Other Foreign Exchange Fluctuation (Net) 1418.03 1794.47
Total 124251.05 114524.89
(H In Lacs)
Particulars For the year
ended
31st March 2019
For the year
ended
31st March2018
Miscellaneous Income 5.77 28.49
Interest Received 271.31 190.07
Profit on Sale of Fixed Assets - 0.08
Profit on Sale of Investment - 7.12
Total 277.08 225.76
(H In Lacs)
Particulars For the year
ended
31st March 2019
For the year
ended
31st March2018
StockatOpening Cotton 16700.51 11643.21
Yarn 55.56 94.01
Add : Purchases & Expenses Cotton 76388.23 75959.94
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
95
NOTES TO THE FINANCIAL STATEMENTS
Note 24: Cost of Material Consumed (Contd..)
Note25:ChangesinInventoriesofFinishedGoods,Work-in-progressandStock-in-Trade
Note26:EmployeeBenefitsExpense
(H In Lacs)
Particulars For the year
ended
31st March 2019
For the year
ended
31st March2018
Salary & Wages 5662.95 5101.77
Contribution to Providend and Other Fund 520.44 477.11
Gratuity and Leave Encashment Expenses 324.11 249.54
Staff Welfare Expenses 292.35 236.88
Total 6799.85 6065.30
(H In Lacs)
Particulars For the year
ended
31st March 2019
For the year
ended
31st March2018
ClosingStock Finished Goods 2477.67 1963.72
Work-In-Progress 1279.13 1062.58
Total (A) 3756.80 3026.30OpeningStock Finished Goods 1963.72 3236.28
Work-In-Progress 1062.58 1134.80
Total (B) 3026.30 4371.08(Increase)/DecreaseinStocks (730.50) 1344.78
Note 27: Finance Cost
(H In Lacs)
Particulars For the year
ended
31st March 2019
For the year
ended
31st March2018
Interest Expenses
Term Loans 1128.80 1489.24
Others 1378.64 982.18
2507.44 2471.42Other Borrowing Costs 382.93 483.45
Total 2890.37 2954.87
(H In Lacs)
Particulars For the year
ended
31st March 2019
For the year
ended
31st March2018
Yarn 725.53 470.69
Total 93869.83 88167.85Less:StockatClosing Cotton 14922.67 16700.51
Yarn 67.91 55.56
Total 78879.25 71411.78
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
96
NOTES TO THE FINANCIAL STATEMENTS
Note 28 : Other Expense
(H In Lacs)
Particulars For the year
ended
31st March 2019
For the year
ended
31st March2018
(a) Manufacturing Expenses Power, Fuel & Water charges 13314.87 12551.39
Stores & Spares Consumed 2487.82 2227.50
Packing Expenses 1522.23 1555.55
Job Charges Paid 7.43 -
Repair & Maintenance
Plant & Machinery 84.73 132.41
Building 34.76 40.29
Others 18.29 23.59
Excise Duty - 0.68
Total (a) 17470.13 16531.41(b) Administrative and Other Expenses Printing & Stationary 24.93 22.34
Postage & Communication 18.06 20.99
Subscription & Membership Fees 1.90 2.24
Director's Sitting Fee 4.50 3.58
Rent 3.90 3.90
Rates & Taxes 19.15 15.19
Travelling Exp - Directors 19.44 11.98
- others 17.83 32.77
Vehicle & Conveyance 102.11 101.09
Charity & Donation 0.83 0.83
CSR Expenditure 48.54 4.50
Legal & Professional 23.21 32.34
Insurance Charges 48.45 29.08
Loss on Sale of Fixed Assets 23.93 0.49
Payment to Auditors 16.76 10.50
Cost Audit Fees 0.50 0.40
Advertisement 15.47 9.56
Software Expenses 6.96 5.03
Provision for Doubtful Debts - 29.04
Bad Debts Written Off 19.04 -
Miscellaneous Expenses 13.17 2.92
Total (b) 428.68 338.77(c) Selling and Distribution Expenses Sales Promotion 40.34 43.53
Sales Commission 1358.91 1233.48
Rebate, Claims & Discount 177.13 70.30
Freight & Forwarding 1936.90 1902.78
Hank Yarn Obligation Expenses 83.11 91.13
Total (c) 3596.39 3341.22 Total (a to c) 21495.20 20211.40
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
97
NOTES TO THE FINANCIAL STATEMENTS
Note 28 : Other Expense (Contd..)
Note 28.1 : Payment to Auditors
(H In Lacs)
Particulars Current Year Previous Year
Audit Fees 7.00 7.00
Tax Audit Fees 1.00 1.00
Legal Services 8.00 2.50
Certification & Others 0.76 -
Total 16.76 10.50
(H In Lacs)
Sr.
No.
Particulars Current Year Previous Year
a. DisputedLiabilitiesnotacknowledgedasdebts - Cenvat, Vat, Service Tax and Custom Duty 2,089.65 1,194.10
b. Guarantees - Outstanding Bank Guarantees 55.59 282.39
c. Other money for which the company is contingently liable -Bills negotiated with Banks (against goods sold) 7,050.25 5,714.32
Disclosures and Additional Informations
Note 29 – Disclosure as per Ind AS 37 "Provisions, Contingent Liabilities and Contingent Assets"
1 Contingent Liabilities not provided for:
2 Commitments
a) Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of
Advances) H 10891.84 (Previous Year – H 8824.45).
b) The company has an outstanding export obligation of approx. H 91204.22 lacs (Previous Year – H 32,153.36 lacs),
in respect of capital goods imported at the concessional rate of duty under Export Promotion Capital Goods
Scheme, which is required to be met at different dates on or before 31.03.2025.
Note 30 - Disclosure as per Ind AS 12 “Income Taxes”
(a) ReconciliationofTaxExpenseandtheaccountingprofitmultipliedbyIndia'sTaxRate:
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Accounting Profit Before Tax 9,730.08 7,143.51
Taxusingcompany'sdomestictaxrateforrespectiveyear 3,400.09 2,472.22 Effect of Non-deductible Expense 13.66 (25.62)
Effect of Depreciation (4.94) (27.43)
Effect of Changes in Tax Rate 60.35 -
Tax in respect of earlier years (149.77) (514.25)
TaxasperStatementofProfit&Loss 3,319.39 1,904.92
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
98
NOTES TO THE FINANCIAL STATEMENTS
(b) Income Tax Expense
i. IncomeTaxrecognizedinStatementofProfitandLoss
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
[A]Current Tax expense: Current Year 3,641.33 1,597.64
Adjustment for earlier years (149.77) (514.25)
Total [A] 3,491.56 1,083.39 [B] Deferred Tax Expense Origination and reversal of temporary differences (172.17) 821.53
Total [B] (172.17) 821.53 Total Income Tax [A+B] 3,319.39 1,904.92
(H In Lacs)
Particulars As at 1st April
2018
Recognised in
P&L A/c
As at 31st
March 2019
(A) Deferred tax Assets -Provision for Employee benefit and others 396.60 102.61 499.21
-Impairment allowances 10.05 (10.05) -
Total (A) 406.65 92.56 499.21 (B) Deferred Tax Liability -Impact of temporary difference in depreciation 6,599.84 (74.41) 6,525.43
-Amortised value of financial assets 14.12 81.66 95.78
Total (B) 6,613.96 7.25 6,621.21 Net Deferred Tax Liability (B-A) 6,207.31 (85.31) 6,122.00 Less: Liability net off through MAT Credit
Entitlement
4,530.00 (1,399.17) 3,130.83
Net Deferred Tax Liability 1,677.31 1,313.86 2,991.17
(H In Lacs)
Particulars As at 31st March 2019 As at 31st March 2018
Before
Tax
Tax
Expenses
Net of
Tax
Before
Tax
Tax
Expenses
Net of
Tax
Net Actuarial Gain/
(Losses) on Defined
Benefit plans
9.06 3.17 5.89 60.96 21.10 39.86
ii. Income Tax recognized in Other Comprehensive Income
(c) Movement in Deferred tax Asset/ Liability
Note 30 - Disclosure as per Ind AS 12 “Income Taxes” (Contd..)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
99
NOTES TO THE FINANCIAL STATEMENTS
Note 30 - Disclosure as per Ind AS 12 “Income Taxes” (Contd..)
Note 31 - Disclosure as per Ind AS 23 “Borrowing Cost”
Note 32 - Disclosure as per Ind AS 24 “Related Party Disclosures”
(H In Lacs)
Financial Years As at 31st
March 2019
Expiry date
F.Y. 2013-14 149.21 F.Y. 2023-24
F.Y. 2014-15 1,126.56 F.Y. 2024-25
F.Y. 2015-16 582.47 F.Y. 2025-26
F.Y. 2016-17 1,272.59 F.Y. 2026-27
Total 3,130.83
(d) MAT Credit Available to the company in future:
(e) Reconciliation of Deferred Tax Liabilities (Net)
(H In Lacs)
Particulars 2018-19 2017-18
Deferred tax liability at the beginning of the year 1,677.31 1,383.62 Deferred tax (income)/ expenses during the year recognised in the
Statement of Profit and Loss
1,226.98 382.27
Deferred tax (income)/ expenses during the year recognised in Other
Comprehensive Income
86.88 (88.58)
Deferred tax liability at the end of the year 2,991.17 1,677.31
(H In Lacs)
Particulars 31.03.2019 31.03.2018
Amount of Borrowing Cost Capitalized 862.85 Nil
Capitalization Rate 9.21% -
1. ListofRelatedPartieswithwhomtransactionshavetakenplace:-
(a) Key Management Personnel:-
Name of Person Relationship
Shri R.L. Nolkha Chairman
Shri Dinesh Nolkha Managing Director
Shri Nitin Nolakha Executive Director
Shri P. Maheshwari Chief Financial Officer
Shri Sudhir Garg Company Secretary & GM (Legal)
(c) Related Companies:-
Name of Company Relationship
Redial Trading & Investment Pvt. Ltd. Holding 31.53% shares of the Company
Name of Person Relationship
Smt. Sushila Devi Nolkha Wife of Shri R.L. Nolkha,
Mother of Shri Dinesh Nolkha & Shri Nitin Nolakha
(b) Relatives:-
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
100
NOTES TO THE FINANCIAL STATEMENTS
Note 32 - Disclosure as per Ind AS 24 “Related Party Disclosures” (Contd..)
2. Details of Transactions with related parties:-
(H In Lacs)
Sr.
No.
Nature of Transactions For the
year ended
2018-2019
For the
year ended
2017-2018
1 Rent Payment Smt. Sushila Devi Nolkha 3.00 3.00
Redial Trading & Investment Pvt. Ltd. 0.90 0.90
2 Managerial Remuneration Shri R.L. Nolkha 132.62 107.95
Shri Dinesh Nolkha 123.23 99.51
Shri Nitin Nolakha 115.22 92.28
Shri P. Maheshwari 29.04 24.04
Shri Sudhir Garg 19.29 16.72
3 Interest Payment on unsecured loansShri R.L. Nolkha - 1.93
Shri Dinesh Nolkha - 0.22
Shri Nitin Nolakha - 0.58
Redial Trading & Investment Pvt. Ltd 12.48 31.50
4 Sitting Fees Paid to Independent DirectorShri Y.R. Shah 1.50 1.13
Shri R. Chattopadhyay 1.60 1.13
Smt. Aditi Mehta 1.40 1.33
(H In Lacs)
Sr.
No.
Name of related party Maximum balance outstanding
during the year
For the
year ended
2018-2019
For the
year ended
2017-2018
1 Shri R.L. Nolkha - 115.00
2 Shri Dinesh Nolkha - 45.00
3 Shri Nitin Nolakha - 45.00
4 Redial Trading & Investment Pvt. Ltd 800.00 694.00
3a. Balance due to related parties - H Nil (Previous Year H Nil)
3b. The Maximum balance outstanding during the year from Related Party are as under:
(d) Independent Director
Name of Person Relationship
Shri Y.R. Shah Independent Director
Shri R. Chattopadhyay Independent Director
Smt. Aditi Mehta Independent Director
1. ListofRelatedPartieswithwhomtransactionshavetakenplace:-
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
101
NOTES TO THE FINANCIAL STATEMENTS
Note 33- Disclosure as per Ind AS 33 “Earning Per Share (EPS)”
Note No.34 - Dividend on Equity Shares
Note35-DisclosureasperIndAS19“EmployeeBenefits”
(H In Lacs)
Sr.
No.
Particulars As at 31st
March 2019
As at 31st
March 2018
a) Net Profit available to Equity Shareholders 6,410.69 5,238.59
b) Weighted Average Number of Equity Shares of H 10 each
outstanding during the year (in lacs)
560.83 495.99
c) Basic/Diluted Earning per share (H) 11.43 10.56
d) Face Value of each equity share (H) 10 10
Particulars As on 31.03.19 As on 31.03.18
Opening balance of issued Equity Shares 5,55,51,710 4,58,33,945
Effect of Shares issued during the year:
6,68,290 Equity Shares issued on 15th June, 2018 5,30,970 -
93,85,765 Equity Shares issued on 07th November, 2017 - 37,28,592
3,32,000 Equity Shares issued on 20th February, 2018 - 36,384
Weighted Average No. of Equity Shares J 10 each 5,60,82,680 4,95,98,921
i) Basic and Diluted Earnings Per Share (in J)
ii) Weighted Average Number of Equity Shares
(H In Lacs)
Particulars Year 2018-19 Year 2017-18
(i) Dividend Declared and paid during the year
Final dividend for the year ended 31st March, 2018 of H 1.20
(31st March 2017- H 1.20) per fully paid Equity Share
674.64 550.01
Dividend Distribution Tax on Final Dividend 138.67 111.97
Total 813.31 661.98
(ii) Dividend not recognised at the end of reporting period
In addition to the above dividends, at the year end the company's Board of Directors have proposed the payment
of final dividend of H 1.25 (31st March 2018- H 1.20) per fully paid Equity Share. This proposed dividend is subject to
the approval of the shareholders in Annual General Meeting. The total outgo towards the same will be H 847.20 Lacs
including Dividend Distribution Tax.
a) DefinedContributionPlan
The Company makes contributions towards Employees Provident Fund and Family Pension Fund for qualifying
employees. The Fund is operated by the Regional Provident Fund Commissioner. The amount of contribution is
recognized as expense for defined contribution plans.
Total contribution made by the employer to the Fund during the year is H 358.22 lacs (Previous Year H 341.44 Lacs).
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
102
NOTES TO THE FINANCIAL STATEMENTS
b) DefinedBenefitPlan&OtherLongTermBenefits
(i) Gratuity
The Company makes payment to vested employees as per provisions of Payment of Gratuity Act, 1972. The
provision of Gratuity liability as on the Balance Sheet date is done on actuarial valuation basis for qualifying
employees, however the same is not funded to any trust or scheme.
The present value of the Defined Benefits obligation and the related current service cost is measured using the
Projected Unit Credit Actuarial Method at the end of Balance Sheet date by the Actuary.
(ii) Leave Encashment
The company provides benefit of leave encashment to its employees as per defined rules. The provision for
liability for leave encashment as on date of Balance Sheet is recognised on the basis of Actuarial certificate.
(iii) The following table set out the status of Gratuity and Leave encashment plans as required under Ind AS-19 :
(a) Changesindefinedbenefitobligations:-
Note35-DisclosureasperIndAS19“EmployeeBenefits”(Contd..)
(H In Lacs)
Particulars For the year ended
2018-19
For the year ended
2017-18
Gratuity Leave
Encashment
Gratuity Leave
Encashment
Defined Benefit obligation at the beginning of
the period
779.80 214.94 653.68 179.59
Interest cost 61.29 16.89 51.38 14.11
Current service cost 190.53 77.65 153.55 69.52
Benefits paid (20.59) (12.64) (17.85) (9.26)
Actuarial (gain)/loss on obligation (9.06) (22.26) (60.96) (39.02)
Present value of obligation at the end of period 1,001.97 274.58 779.80 214.94
(H In Lacs)
Particulars Gratuity
For the year
ended 2018-19
For the year
ended 2017-18
Actuarial (Gain)/Loss for the year on Projected Benefit Obligations (9.05) (60.96)
Unrecognized actuarial (Gain)/Loss at the end of the year (9.05) (60.96)
(H In Lacs)
Particulars For the year ended
2018-19
For the year ended
2017-18
Gratuity Leave
Encashment
Gratuity Leave
Encashment
Current service Cost 190.54 77.65 153.55 69.52
Interest Cost 61.29 16.89 51.38 14.11
Net actuarial (gain)/loss recognized in the
period
- (22.26) - (39.02)
ExpensesrecognizedintheProfit&Loss
statement
251.83 72.28 204.93 44.61
(b) NetDefinedBenefitCost/(Income)includedinthe:-
1. StatementofProfitandLoss
2. OtherComprehensiveIncome:-
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
103
NOTES TO THE FINANCIAL STATEMENTS
Note35-DisclosureasperIndAS19“EmployeeBenefits”(Contd..)
(H In Lacs)
Particulars For the year ended
2018-19
For the year ended
2017-18
Gratuity Leave
Encashment
Gratuity Leave
Encashment
Present value of obligation as at the end of
period
1,001.97 274.58 779.80 214.94
Fair value of Plan Assets - - - -
Liability Recognized in Balance Sheet 1,001.97 274.58 779.80 214.94
(H In Lacs)
Particulars Gratuity Leave
Encashment
Defined benefit Obligation - Discount Rate+50 Basis points (67.20) (19.54)
Defined benefit Obligation - Discount Rate-50 Basis points 74.82 21.87
Defined benefit Obligation – Salary Escalation Rate+50 Basis points 74.20 21.69
Defined benefit Obligation – Salary Escalation Rate-50 Basis points (67.30) (19.57)
(c) ReconciliationofthePresentvalueofDefinedObligationandthefairvalueoftheplanassets:
(d) The assumptions used in Actuarial Valuation:-
(e) Sensitivity Analysis as at 31.03.2019:-
(H In Lacs)
FinancialAssumptionsusedtodeterminetheProfit&Loss
Charge
For the
year ended
2018-2019
For the
year ended
2017-2018
a) Discounting Rate 7.66% p.a. 7.86% p.a.
b) Salary Escalation Rate 8.00% p.a. 8.00% p.a.
c) Expected rate of Return on Assets 0.00%p.a. 0.00%p.a.
DemographicAssumptionsUsedtodeterminetheDefined
Benefita) Retirement Age 60 Years 60 Years
b) Mortality Table IALM (2006-2008)
c) Employee Turnover/Attrition Rate
18 TO 30 Years 3.00% 3.00%
30 to 45 Years 2.00% 2.00%
Above 45 Years 1.00% 1.00%
(f) Expected Cash Flows for the next ten years as at 31.03.2019:-
(H In Lacs)
Particulars Gratuity
Within 1 Year 85.68
1-5 Years 87.01
Beyond 5 Years but upto 10 Years 829.28
Total Expected Payments 1,001.97
(g) The estimates of future salary increase; considered in actuarial valuation, take account of inflation, seniority,
promotions and other relevant factors such as supply and demand in the employment market.
(h) The discount rate is based on prevailing market yields of Indian Government Bonds, as at the balance sheet
date, consistent with the currency and estimated term of the post employment benefit obligations.
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
104
NOTES TO THE FINANCIAL STATEMENTS
Note No.36-Disclosure as per Ind AS 107 “Financial instrument disclosure”
i. Capital Management
For the purpose of the Company’s capital management, capital includes issued equity capital and all other equity
reserves attributable to the equity holders of the Company. The primary objective of the Company’s capital
management is to ensure that it maintains an efficient capital structure and healthy capital ratios in order to support
its business and maximize shareholder value.
The Company manages its capital so as to safeguard its ability to continue as a going concern and to optimise
returns to shareholders. The capital structure of the Company is based on management’s judgement of its strategic
and day-to-day needs with a focus on total equity so as to maintain investor, creditors and market confidence.
The management and the Board of Directors monitors the return on capital as well as the level of dividends to
shareholders. The Company may take appropriate steps iin order to maintain, or if necessary adjust, its capital structure.
The Company monitors capital using a gearing ratio, which is calculated by dividing Net Debt from the Equity.
The Company includes within Net Debt, interest bearing loans and borrowings less cash and short-term deposits
(including other bank balance) and under Equity, the Equity Share Capital plus other Equity (excluding Preference
Share Capital) is considered.
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Gross Debt 86,047.47 44,917.14
Less: Cash and Cash Equivalents (275.01) (10.01)
Net Debt (A) 85,772.46 44,907.13 Total Equity (B) 48,253.47 41,683.15 Gearing Ratio (A/B) 1.78 1.08
ii. FinancialRiskManagement
The Company's Financial Risk Management is an integral part of how to plan and execute its business strategies. The
Company's financial risk management is set by the Managing Board.
Company is exposed to following risk from the use of its financial instrument:
-Credit Risk
-Liquidity Risk
-Market Risk
(a) Credit risk
Financial assets are written off when there is no reasonable expectation of recovery, such as a debtor failing to
engage in a repayment plan with the Company. The Company categories a loan or receivable for write off when
a debtor fails to make contractual payments greater than 2 years past due. Where loans or receivables have
been written off, the Company continues to engage in enforcement activity to attempt to recover the receivable
due. Where recoveries are made, these are recognized in profit or loss.
Provision for Expected Credit or Loss
(a) Financialassetsforwhichlossallowanceismeasuredusing12monthexpectedcreditlosses:
The Company has assets where the counter-parties have sufficient capacity to meet the obligations and
where the risk of default is very low. Accordingly, no loss allowance for impairment has been recognized.
(b) Financialassetsforwhichlossallowanceismeasuredusinglifetimeexpectedcreditlosses:
The Company provides loss allowance on trade receivables using life time expected credit loss and as per
simplified approach.
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
105
NOTES TO THE FINANCIAL STATEMENTS
Note No.36-Disclosure as per Ind AS 107 “Financial instrument disclosure” (Contd..)
Ageing of trade receivables
ii. FinancialRiskManagement(Contd..)
(H In Lacs)
Ageing Not Due 0-180
days
past due
181-365
days
past due
1-2 years
past due
2-5 years
past due
Total
Gross Carrying amount as on
31.03.2019
10,053.54 2,019.00 - - - 12,072.54
Impairment loss recognized in
2018-19
- - - - - -
Gross Carrying amount as on
31.03.2018
7,363.35 1,417.65 58.09 - - 8,839.09
Impairment loss recognized in
2017-18
- - 29.04 - - 29.04
Hedge Accounting Disclosures
The Cash Flow hedging reserve represents the cumulative effective portion of gains or losses arising on charges
in fair value of designated portion of hedging instruments entered into cash flow hedges. The cumulative gain or
loss arising on changes in fair value of the designated portion of the hedging instruments that are recognized and
accumulated under the heading of cash flow reserve will be reclassified to statement of profit and loss only when the
hedged transaction affects the profit or loss or included as a basic adjustment to the non financial hedged item.
(b) Liquidity Risk
To replace net outflows due to unanticipated outflows. Liquidity risk is defined as the risk that the Company will
not be able to settle of meet its obligations on time or at a reasonable price. The Company's finance department
is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related
to such risks are overseen by senior management. Management monitors the Company's net liquidity position
through rolling forecasts on the basis of expected cash flows.
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with
its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach to
managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities
when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage
to the Company’s reputation.
The table below summarizes the maturity profile of the Company’s financial liabilities based on contractual
undiscounted payments:
As on 31.03.2019
(H In Lacs)
Contractual maturities of
financialliabilities
Contractualcashflows Total
3 Months
or less
3-12
Months
1-2
Years
2-5
Years
More than
5 Years
Term Loans from banks* 2,961.03 9,474.10 15,722.61 46,741.55 34,876.43 1,09,775.72 Term loans from Bank (vehicle
loan)
1.40 0.95 - - - 2.35
Trade and other Payables 3,543.52 - - - - 3,543.52
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
106
Note No.36-Disclosure as per Ind AS 107 “Financial instrument disclosure” (Contd..)
NOTES TO THE FINANCIAL STATEMENTS
(b) Liquidity Risk (Contd..)
As on 31.03.2018
(H In Lacs)
Contractual maturities of
financialliabilities
Contractualcashflows Total
3 Months
or less
3-12
Months
1-2
Years
2-5
Years
More than
5 Years
Term Loans from banks* 2,099.84 6,123.92 8,270.64 23,501.75 7,070.60 47,066.74 Term loans from Bank (vehicle
loan)
2.37 4.03 1.89 - - 8.29
Trade and other Payables 2,556.60 - - - - 2,556.60
*Includes contractual interest payment based on interest rate prevaling at the end of the reporting period over the tenure of the
borrowing.
The Company has accessed the following undrawn facilities at the end of reporting period:
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Fixed Rate Borrowings: - -
Floating-rate borrowings: 1,807.38 9,248.45
Total- Undrawn Facilities 1,807.38 9,248.45
(c) Market Risk
Considering the company's existing foothold/experience in the spinning sector, established & diversified client
base, association with various international/domestic agents, it's competent sales executives and an established
marketing setup, it does not foresee any problem in marketing its additional production.
Since major portion will be sold in the export market company is confident of leveraging on its existing network
of overseas buyers.
Market Risk is the risk of loss of future earnings, fair values of future cash flows that may result from
a change in the price of a financial instrument. The value of a financial instrument may change as
a result of changes in the interest rates, foreign currency exchanges rates, equity prices and other
market changes that effect market risk sensitive instruments. Market risk is attributable to all market
risk sensitive financial instruments including investments and deposits, and other market changes.
The Company manages market risk through a finance department, which evaluates and exercises independent
control over the entire process of market risk management. The finance department recommends risk
management objectives and policies, which are approved by Senior Management and the Audit Committee.
The activities of this department include management of cash resources, implementing hedging strategies
for foreign currency exposures, borrowing strategies, and ensuring compliance with market risk limits and
policies.
i) Interest Rate Risk
It is the risk where changes in market interest rates might adversely affect the company's financial condition.
The short term/immediate impact of changes in interest rates are on the company's net interest income
(NII). On a longer term, change in interest rate impact the cash flows on the assets, liabilities and off-balance
sheet items, giving rise to a risk to the net worth of the company arising out of all reprising mismatches and
other interest rate sensitive positions.
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
107
Note No.36-Disclosure as per Ind AS 107 “Financial instrument disclosure” (Contd..)
NOTES TO THE FINANCIAL STATEMENTS
(c) Market Risk (Contd..)
(H In Lacs)
Particulars EffectofProfitorLoss
50 BP decrease 50 BP increase
31st March 2019Term Loans 337.52 (337.52)
Loan repayable on demand 92.72 (92.72)
Total 430.24 (430.24)31st March 2018Term Loans 180.83 (180.83)
Loan repayable on demand 43.76 (43.76)
Total 224.59 (224.59)
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Variable rate instrumentsLong Term Borrowings 61,873.51 31,050.14
Current maturities of long term debts 5,630.60 5,115.45
Short Term Borrowings 18,543.36 8,751.55
Total 86,047.47 44,917.14
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market interest rate. In order to optimize the Company's position with regards to
interest income and interest expenses and to manage the interest rate risk, treasury performs a comprehensive
corporate interest rate risk management by balancing the proportion of fixed rate and floating rate financial
instruments in its total portfolio.
At the reporting date the interest rate profile of the Company’s interest-bearing financial instruments is as follows:
Detailoffinancialinstrumentbearinginterestraterisk
At the reporting date the interest rate profile of the company’s interest bearing financial instrument is at its
fair value:
Interestratesensitivity
The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that
portion of loans and borrowings affected. With all other variables held constant, the Company’s profit before
tax is affected through the impact on floating rate borrowings, as follows:
ii) Foreign Exchange Risk
It is the risk that the company may suffer losses as a result of adverse exchange rates movements during a
period in which it has an open position in an individual foreign currency. In addition, the company may also
expose to the following risks on account of foreign exchange exposures as applicable.
Interest Rate Risk - Which arises from the maturity mismatches of foreign currency position
Settlement Risk - On account of risk of default of the counter parties.
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
108
NOTES TO THE FINANCIAL STATEMENTS
Note No.36-Disclosure as per Ind AS 107 “Financial instrument disclosure” (Contd..)
(Foreign Currency In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
Exposure on account of Financial AssetsTrade Receivables (net of Bill Discounted) (A)
: In USD 100.25 83.16
: In Euro 1.14 1.80
: In GBP 0.48 0.19
Amount hedged through Forward Contracts (B)
: In USD 100.25 83.16
: In Euro 1.14 1.80
: In GBP 0.48 0.19
Net Exposure to Foreign Currency Assets (C = A-B)
: In USD - -
: In Euro - -
: In GBP - -
Exposure on account of Financial LiabilitiesTrade Payables (D)
: In USD 3.25 3.99
: In Euro 0.08 0.15
: In GBP 0.06 0.09
: In CHF 0.34 -
Amount hedged through Forward Contracts (E)
: In USD - -
: In Euro - -
: In GBP - -
: In CHF - -
Net Exposure to Foreign Currency Liabilities(F = D-E)
: In USD 3.25 3.99
: In Euro 0.08 0.15
: In GBP 0.06 0.09
: In CHF 0.34 -
Net Exposure to Foreign Currency Assets/Liabilities (C-F)
: In USD (3.25) (3.99)
: In Euro (0.08) (0.15)
: In GBP (0.06) (0.09)
: In CHF (0.34) -
The Company uses forward contracts to hedge its risk associated with fluctuation in foreign currency relating
to foreign currency assets and liabilities, firm commitments and highly probable forecast transactions. The use
of the aforesaid financial instruments is governed by the company’s overall Risk Management Strategy. The
company does not use forward contracts and options for speculative purposes. The details of the outstanding
forward contracts and unhedged currency exposure as at 31st March, 2019 is as under :
(H In Lacs)
Particulars Current Year Previous Year
Foreign
Currency
INR Foreign
Currency
INR
Forward Contracts outstanding (for Hedging)USD (Sale) 200.69 14,397.81 199.08 13,019.25
EURO (Sale) 1.20 97.48 6.35 513.85
GBP (Sale) 0.99 93.60 1.19 109.84
Total 202.88 14,588.89 206.62 13,642.94
ExposuretoForeignCurrency:
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
109
NOTES TO THE FINANCIAL STATEMENTS
Note No.36-Disclosure as per Ind AS 107 “Financial instrument disclosure” (Contd..)
(H In Lacs)
Particulars As at 31st
March 2019
As at 31st
March 2018
1% Appreciation in INRImpact on Equity 2.60 2.80
Impact on P&L 2.60 2.80
1% Depreciation in INRImpact on Equity (2.60) (2.80)
Impact on P&L (2.60) (2.80)
ii) Foreign Exchange Risk (Contd..)
ForeignCurrencysensitivity:
The following tables demonstrate the sensitivity to a reasonably possible change in USD, EURO, GBP and CHF
rates to the functional currency of respective entity, with all other variables held constant. The Company’s
exposure to foreign currency changes for all other currencies is not material. The impact on the Company’s
profit before tax is due to changes in the fair value of monetary assets and liabilities.
Note 37 - Disclosure as per Ind AS 115 "Revenue from Contract with Customers"
The company has adopted Ind AS 115 "Revenue from Contracts with Customers" which is mandatory for reporting
periods begining on or after 01st April 2018. The Company has adopted the cumulative catch-up transition method,
applied to contracts that were not completed as of April 1, 2018. In accordance with this method, the comparatives have
not been retrospectively adjusted. Application of Ind AS 115 does not have any material impact on the financial results
of the company.
Disaggregate revenue information
The table below presents disaggregated revenues from contracts with customers for the year ended March 31, 2019
by contract-type. The Company believes that this disaggregation best depicts how the nature, amount, timing and
uncertainty of our revenues and cash flows are affected by industry, market and other economic factors.
(H In Lacs)
Particulars Current Year Previous Year
Foreign
Currency
INR Foreign
Currency
INR
Unhedged forex exposure Payable – USD 3.25 224.81 3.99 259.53
Payable – EURO 0.08 6.22 0.15 12.09
Payable – GBP 0.06 5.43 0.09 8.31
Payable – CHF 0.34 23.60 - -
Total 3.73 260.05 4.23 279.93
(H In Lacs)
Particulars For the
year Ended
31stMarch 2019
Revenues on the basis of Geographical area - Domestic Sales 39,844.55
- Export Sales (Including Export Incentives) 84,406.49
Total 1,24,251.04
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
110
NOTES TO THE FINANCIAL STATEMENTS
Note 37 - Disclosure as per Ind AS 115 "Revenue from Contract with Customers" (Contd..)
Trade receivables and Contract Balances
The company classifies the right to consideration in exchange for deliverables either as a receivable or as unbilled
revenue. A receivable is a right to consideration that is unconditional upon passage of time. Revenues in excess of
billings is recorded as unbilled revenue and is classified as a financial asset for these cases as right to consideration
is unconditional upon passage of time. This would result in the timing of revenue recognition being different from the
timing of billing the customers.
Company classifies amount received as advance from customers against sales as contract liability.
Trade receivable and unbilled revenues are presented net of impairment in the Balance Sheet.
During the year ended 31st March 2019, the company recognizes revenue of H 65.29 Lacs arising from opening contract
liabilities as of 1st April, 2018.
Performance obligations and remaining performance
The remaining performance obligation disclosure provides the aggregate amount of the transaction price yet to be
recognized as at the end of the reporting period and an explanation as to when the Company expects to recognize
these amounts in revenue. Applying the practical expedient as given in para 121 of Ind AS 115, the Company has not
disclosed the remaining performance obligation related disclosures for contracts as the performance obligation is part
of a contract that has an original expected duration of less than 1 year.
The remaining performance obligation as on 31st March 2019 is H 53.19 Lacs which is to be satisfied within 1 year or
less
The impact on account of applying the erstwhile IndAS 18 Revenue instead of IndAS 115 Revenue from contract with
customers on the financials results of the Company for the year ended as at March 31, 2019 is insignificant.
Note 38 - Disclosure as per Ind AS 108 "Operating Segments"
(i) The Company is engaged in Business of Textiles. Hence there is no separate business segments
Details of Export outside country and Domestic sales within country are as under:
(H In Lacs)
Particulars Current Year Previous Year
Segment Revenue - Within India (Domestic Sales) 39,844.55 40,813.06
- Outside India (Exports - Including Export Incentives) 84,406.49 73,711.83
Total 1,24,251.04 1,14,524.89
Note 39 - Disclosure of Corporate social responsibility (CSR)
As per section 135 of Companies Act the company is required to spend in every financial year , at least 2% of the average
net profits of the company made during the three immediately preceding financial year in accordance with its CSR
policy.
A. Gross amount required to be spent by the Company during the year 2018-19 – H137.93 Lacs (Year 2017-18 - H 126.50
Lacs)
CORPORATE OVERVIEW 02 STATUTORY
REPORTS 20 FINANCIAL STATEMENTS 61
111
NOTES TO THE FINANCIAL STATEMENTS
(H In Lacs)
Particulars Year 2018-19 Year 2017-18
i) Construction/ Acquisition of any assets 93.92 126.90
ii) Purposes other than (i) above 48.54 4.50
Total 142.46 131.40
Note 40 : Recent Accounting Pronouncements
a) Ind AS 116 Leases: On March 30, 2019, Ministry of Corporate Affairs has notified Ind AS 116, Leases. Ind AS 116
will replace the existing leases Standard, Ind AS 17 Leases, and related Interpretations. The Standard sets out the
principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract
i.e., the lessee and the lessor. Ind AS 116 introduces a single lessee accounting model and requires a lessee to
recognize assets and liabilities for all leases with a term of more than twelve months, unless the underlying asset is
of low value. Currently, operating lease expenses are charged to the statement of Profit & Loss. The Standard also
contains enhanced disclosure requirements for lessees. Ind AS 116 substantially carries forward the lessor accounting
requirements in Ind AS 17. The effective date for adoption of Ind AS 116 is annual periods beginning on or after April
1, 2019. The standard permits two possible methods of transition:
• Full retrospective – Retrospectively to each prior period presented applying Ind AS 8 Accounting Policies,
Changes in Accounting Estimates and Errors.
• Modified retrospective – Retrospectively, with the cumulative effect of initially applying the Standard recognized
at the date of initial application
Under modified retrospective approach, the lessee records the lease liability as the present value of the remaining
lease payments, discounted at the incremental borrowing rate and the right of use asset either as:
• Its carrying amount as if the standard had been applied since the commencement date, but discounted at
lessee’s incremental borrowing rate at the date of initial application or
• An amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments related
to that lease recognized under IndAS 17 immediately before the date of initial application.
Certain practical expedients are available under both the methods.
On completion of evaluation of the effect of adoption of IndAS116,the Company is proposing to use the ‘Modified
Retrospective Approach’ for transitioning to IndAS 116, and take the cumulative adjustment to retained earnings, on
the date of initial application(April1,2019). Accordingly, comparatives for the year ended March31,2019 will not be
retrospectively adjusted. The Company has elected certain available practical expedients on transition.
The effect of adoption as on transition date would be insignificant.
b) Ind AS 12 Appendix C, Uncertainty over Income Tax Treatments: On March 30, 2019, Ministry of Corporate Affairs
has notified Ind AS 12 Appendix C, Uncertainty over Income Tax Treatments which is to be applied while performing
the determination of taxable profit (or loss), tax bases, unused tax losses, unused tax credits and tax rates, when
there is uncertainty over income tax treatments under Ind AS 12. According to the appendix, companies need to
determine the probability of the relevant tax authority accepting each tax treatment, or group of tax treatments,
that the companies have used or plan to use in their income tax filing which has to be considered to compute the
most likely amount or the expected value of the tax treatment when determining taxable profit (tax loss), tax bases,
unused tax losses, unused tax credits and tax rates.
B. Amount spent during the year on:
Note 39 - Disclosure of Corporate social responsibility (CSR) (Contd..)
NITIN SPINNERS LIMITED | ANNUAL REPORT 2018-19
112
NOTES TO THE FINANCIAL STATEMENTS
The standard permits two possible methods of transition –
i) Full retrospective approach – Under this approach, Appendix C will be applied retrospectively to each prior
reporting period presented in accordance with Ind AS 8 – Accounting Policies, Changes in Accounting Estimates
and Errors, without using hindsight, and
ii) Retrospectively with cumulative effect of initially applying Appendix C recognized by adjusting equity on initial
application, without adjusting comparatives.The effective date for adoption of Ind AS 12 Appendix C is annual
periods beginning on or after April 1, 2019. The Company will adopt the standard on April 1, 2019 and has
decided to adjust the cumulative effect in equity on the date of initial application i.e. April 1, 2019 without
adjusting comparatives.The effect on adoption of Ind AS 12 Appendix C would be insignificant in the standalone
financial statements.
c) Amendment to Ind AS 12 – Income taxes: On March 30, 2019, Ministry of Corporate Affairs issued amendments
to the guidance in Ind AS 12, ‘Income Taxes’, in connection with accounting for dividend distribution taxes. The
amendment clarifies that an entity shall recognise the income tax consequences of dividends in profit or loss, other
comprehensive income or equity according to where the entity originally recognised those past transactions or
events. Effective date for application of this amendment is annual period beginning on or after April 1, 2019. The
Company is currently evaluating the effect of this amendment on the standalone financial statements.
d) Amendment to Ind AS 19 – plan amendment, curtailment or settlement- On March 30, 2019, Ministry of Corporate
Affairs issued amendments to Ind AS 19, ‘Employee Benefits’, in connection with accounting for plan amendments,
curtailments and settlements.
The amendments require an entity:
• to use updated assumptions to determine current service cost and net interest for the remainder of the period
after a plan amendment, curtailment or settlement; and
• to recognise in profit or loss as part of past service cost, or a gain or loss on settlement, any reduction in a
surplus, even if that surplus was not previously recognised because of the impact of the asset ceiling.
Effective date for application of this amendment is annual period beginning on or after April 1, 2019. The Company
does not have any impact on account of this amendment.
Note 40 : Recent Accounting Pronouncements (Contd..)
In terms of our report of even date For and on behalf of the Board
For KALANI & CO. R.L.NOLKHA DINESH NOLKHA
Chartered Accountants Chairman Managing Director
(Firm Reg. no. 000722C ) (DIN - 00060746) (DIN - 00054658)
S. P. JHANWAR P.MAHESHWARI SUDHIR GARG
Partner Chief Financial Officer Company Secretary & General Manager (Legal)
M.No. 074414 (PAN - ABAPM8005C) (PAN - ABBPK6037F)
Place : Hamirgarh, Bhilwara
Date : 25.05.2019